Activists Plan Massive Antitrust Lawsuits Against Leading Ag Biotech Companies

20 September 1999 00:00  [Source: ICB Americas]

By Glenn Hess

In a change of tactics in their bid to stop the planting of genetically engineered crops, opponents of biotechnology plan to launch a multibillion dollar antitrust action against the world's largest life science companies and major grain traders and processors.

The lawsuits, to be filed in as many as 30 countries, will argue that a handful of companies are exploiting bioengineering techniques to gain a stranglehold on agricultural markets, according to anti-biotech activist Jeremy Rifkin, director of the Foundation on Economic Trends.

Biotech opponents have previously focused on persuading food manufacturers not to buy genetically modified (GM) crops and on getting governments to require the labeling of altered foods.

The antitrust actions are intended to force governments to curb the power of a shrinking number of giant agribusiness companies, Mr. Rifkin says. "We're moving from the GM food labeling issue to an even broader issue of GM seeds and concentration in world agriculture," he adds.

Fewer than a dozen companies now control most GM seeds sold throughout the world, and they are quickly buying out smaller competitors, Mr. Rifkin charges.

The US lawsuit, to be filed in a federal court by December 1, will seek billions of dollars in damages from all major seed companies including Monsanto, DuPont, AstraZeneca PLC and Novartis AG, as well as Archer Daniels Midland and Cargill.

The lawsuit, expected when the World Trade Organization is due to begin a new round of trade talks involving farm subsidies, food safety and biotechnology, is also likely to involve Aventis, the company that will become the world's largest agribusiness when it is formed by a merger of Germany's Hoechst AG and France's RhÖne-Poulenc SA.

Eight major antitrust law firms have agreed to handle the lawsuits, Mr. Rifkin says. In addition to his Washington-based organization, the plaintiffs will include the National Family Farm Coalition and individual farmers across Latin America, Asia, Europe and North America.

Most of the companies decline to comment on the planned lawsuit, though they maintain that the seed industry is competitive. Swiss life sciences giant Novartis, the world's largest agrochemicals manufacturer, says there is no evidence to support allegations that it and other companies control the market for GM crops.

"The agricultural market is characterized by strong competition. Farmers can purchase their seeds from a number of small and large seed companies, and they can choose whether to use genetically modified or conventional seeds," says a Novartis spokesperson.

"If any action should be taken, we will vigorously defend ourselves," adds an official of AstraZeneca, the Anglo-Swedish company that is currently the world's third largest agribusiness.

EuropaBio, which represents Europe's life sciences industry, also says the allegation of market control is unfounded. Farmers can buy seeds from "a large number--in fact several hundred in Europe--of small and large companies," the trade group says.

Although the popularity of genetically enhanced crops has increased quickly with American farmers, the technology has had trouble gaining acceptance in Asia and Europe. And farmers in less-developed nations say that patents on GM seeds unfairly bar them from reusing seed the following season.

But companies have already abandoned that approach in favor of another way of recouping their multi-million dollar investments in GM seeds, according to Per Pinstrup-Anderson, director of the International Food Policy Research Institute.

Companies are developing GM seeds that can "turn on" a special characteristic--the ability to repel pests or drought--only if a farmer buys a chemical to treat the seeds, Mr. Pinstrup-Anderson explains.

Complaints about the alleged concentration of seed producers has caught the attention of members of Congress. Sen. Paul Wellstone (D-Minn.) is drafting a bill that will call for a one-year moratorium on all mergers among agribusinesses with net revenues of more than $50 million.

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