This post was contributed by Frederic Perron-Welch, an International Law Advisor and PhD candidate at the Grotius Centre for International Legal Studies, Leiden University. Frederic lives in Geneva. 

Emerging information technologies such as blockchain may provide opportunities for lowering transaction costs and increasing legal certainty in ABS transactions. The current discussions in the CBD and other fora on the potential of digital sequence information is premised on the fact that  new technology  in terms of next-generation sequencing techniques including gene printing, advanced data mining capacities, and other tools of synthetic biology creates new opportunities for the  utilisation of genetic resources. In this context, the potential of blockchain technology has not been taken into account. This technology first became apparent in the context of cryptocurrencies, but blockchain innovations are anticipated in many industries beyond finance and banking. Given its potential importance for a range of public and private actors, leaders in the field have come together to ensure that the basis for blockchain technology is developed in an open source manner.

Of relevance to access and benefit-sharing and the Nagoya Protocol, blockchain has started appearing in the context of ensuring the traceability of high value natural resources. In this context, individual resources such as diamonds have been provided with a digital token (“fingerprint”) that moves in parallel with the asset, allows them to be traced from the source of origin to the final user. Given the challenge of tracing genetic resources, and associated traditional knowledge, once they have left the country of origin, and ensuring that benefits are shared from their utilization, blockchain technology provides a possible solution.

What is a “blockchain” and what are its characteristics?

Blockchain, also known as distributed ledger technology, a way of organizing digital information. The technology is based on a decentralised distributed database that maintains a continuously-growing list of records called “blocks” that are secured from tampering and revision. Once a block is completed, it is added to the chain, creating a chain of blocks (a “blockchain”), which is typically secured via cryptographic methods. Records encrypted on the blockchain are permanent and cannot be changed. A blockchain transaction provides a record of the nature of the event and the exact order in which it has occurred. Since manipulating the records is very challenging, the information stored is more reliable than data stored in proprietary centralised databases that are susceptible to hackers. The blockchain can thus provide a single version of the truth and assures the authenticity of the data.

The core characteristics of blockchain (immutability, speed and security) make it a valuable tool for tracking and protecting assets and data (e.g. genetic resources and associated traditional knowledge). The information a blockchain does not have to be publicly available. For example, a combination of public and permissioned ledgers can allow for public access to basic information, while also limiting access to private and confidential information to permissioned users. Access to information stored in a ledger might be subject to first accepting pre-specified terms and conditions, such as a confidentiality agreement or other contractual terms (a so-called “smart contract”). These smart contracts can define the rules and penalties in the same way as a traditional contract, and also monitor and execute themselves without an intermediary such as a lawyer. This can increase trust and boost transaction efficiency, which is often a concern in ABS.

Blockchain can also provide for complex structures of storage and access. For example, a blockchain database can also include search engines and key terms, meaning that the information stored can be made searchable by users. In this way, it can provide similar functionalities to traditional proprietary databases.

Benefits of using blockchain in the Nagoya Protocol Context

Blockchain technology has the potential to create a cheaper, more transparent and accessible market place. This is of significant importance in the ABS context.

Some requirements of the Nagoya Protocol might be satisfied by means of blockchain databases, such as the areas discussed below.

Simplified access

A ledger might consist of a short description of the genetic resource, while those wishing to gain access to more information on the qualities of the genetic resource would then have to accept the provisions of an agreement.

PIC and MAT through Smart Contracts

Establishing contractual terms through smart contracts would be immediate, and terms of access and benefit-sharing would be automatically transferred to third parties.

GR and TK Databases

Blockchain databases could be less costly and more secure than traditional databases due to their distributed nature and open-source technology.

Prior Art

The secure character of blockchain might also constitute a reliable source of prior art and source of origin for patent offices worldwide.

Monitoring and Compliance

Blockchain can provide for strong traceability systems and chain of custody verification.  Since data is stored on many computers on a decentralised network, each in direct contact with the other computers, the system is efficient and resistant to manipulation. As such, it may provide a new, secure means of registering  and transferring  information  on rights,  obligations  and information  between providers and users along the supply chain. This could simplify monitoring of compliance under the Nagoya Protocol. Data privacy concerns can be overcome through the use of permissioned blockchain technology that only gives users with the correct security keys access to encrypted data.

Blockchain and ABS in Practice: Amazon Bank of Codes & Earth Bank of Codes

In order to work around the regulatory obstacles that often prevent research on genetic resources, entrepreneur Juan Carlos Castilla-Rubio has proposed the creation of an open library of the Amazon’s biological data (particularly DNA sequences) which can track the use of the data, and automatically distribute part of any commercial value that results from utilization to the country of origin.  The proposed Amazon Bank of Codes (ABC) attempts to combat the misappropriation of genetic resources and lack of benefit sharing by building upon the Nagoya Protocol with blockchain technology. The ABC would be an open, digital platform that maps genetic resources and codifies rights and obligations related to their use with the aim of stimulating innovation while protecting provider countries and communities. Each genetic resource would have a digital fingerprint in the ABC, helping to track who is using which genetic resources and support a benefit-sharing system, thereby enforcing the Nagoya Protocol. Smart contracts would give wary governments peace of mind, while also encouraging innovation.

The ABC is a pilot for a larger, global Earth Bank of Codes (EBC). ABC and EBC are partnered with the Earth BioGenome Project (EBP) – announced in 2015 – which is sequencing the genomes of approximately 1.5 million living species. Although inspiring in theory, one point of concern regarding the EBP is that it is based in the United States, a non-Party to the Convention on Biodiversity and Nagoya Protocol, and the EBP makes no reference to benefit-sharing in its goals or standards development process. The ABC and EBC were recently promoted at the 2018 annual meeting of the World Economic Forum (WEF). Several philanthropists and foundations were said to be interested in funding the projects. However, it will be important to ensure that the rights of national governments and communities are protected in keeping with the Nagoya Protocol.

Though various natural history collections across the world hold samples ready to be sequenced, the majority of the samples for the EBC will have to be collected in situ. Without the cooperation of Parties to the Nagoya Protocol in putting the data into the registry, it will be difficult for the project to move forward. The backers will thus need to persuade governments to give access to researchers and to share data, and the use of an open blockchain ledger is intended to maximize trust and guarantee rights and revenues to title holders. Furthermore, countries which share genetic resources should ideally co-operate on common repositories, and the Brazilian and Peruvian governments have both expressed in the ABC. Mr. Castilla hopes for a proof-of-principle demonstration in 2018.