An innovation developed in a laboratory may take years to reach the field. New seed technologies, biotechnological processes, crop protection products, biological inputs, and other agricultural solutions involve research, testing, regulatory approvals, production, and commercialization. Throughout this process, different intellectual property mechanisms can protect the investments made and enable their economic exploitation.
In agribusiness, however, a single solution may involve rights of different legal natures. A plant variety may be protected under the plant variety protection system, while a technology incorporated into a seed may be covered by one or more patents. Trademarks, know-how, regulatory data, and licensing agreements may also form part of this framework.
Understanding how patents work in agribusiness therefore requires looking at the entire life cycle of a technology: what can be protected, for how long, how royalties are charged, and what happens when one of these rights comes to an end.
What can be patented in agribusiness?
Brazilian law does not allow patents on plants, parts of plants, seeds, or plant cells, even when genetically modified through biotechnology. The Brazilian Industrial Property Law excludes from patent protection living beings, in whole or in part, found in nature, even when isolated, and restricts patentability of living organisms to transgenic microorganisms that meet the legal requirements of novelty, inventive step, and industrial application.
Technical solutions developed through research and human intervention may be patentable when they meet the requirements of novelty, inventive step, and industrial application and do not fall within the exclusions established by law.
This does not, however, prevent the granting of robust biotechnology patents for the agricultural sector. Patentable subject matter before the Brazilian Patent and Trademark Office (INPI) may include:
- Recombinant DNA genetic constructs, expression vectors, and chimeric gene cassettes;
- Biotechnological processes for plant transformation and genetic modification;
- Transgenic microorganisms or microorganisms isolated from biological sources, provided that the requirements for sufficient disclosure are met, often through an international deposit of biological material under the Budapest Treaty;
- Chemical and biological formulations, biological inputs, biostimulants, adjuvants, and crop protection products;
- Machinery, agricultural implements, drones, sensing technologies, and precision agriculture technologies.
In addition, when an innovation involves research or development based on samples from Brazilian biodiversity, compliance with the Brazilian Biodiversity Law, Law No. 13,123/2015, including prior registration with SisGen, the National System for the Management of Genetic Heritage and Associated Traditional Knowledge, is an essential legal requirement for regulatory compliance and the subsequent grant of a patent.
Are patents and plant variety protection the same thing?
No. Although both may apply to the same commercial product, patents and plant variety protection are different forms of intellectual property.
| Aspect | Patent | Plant Variety Protection |
|---|---|---|
| What it protects | Inventions and technical solutions (recombinant genes, processes, formulations, machinery) | New plant varieties or essentially derived varieties |
| Main legislation | Law No. 9,279/1996 (Brazilian Industrial Property Law) | Law No. 9,456/1997 (Brazilian Plant Variety Protection Law) |
| Responsible authority | Brazilian Patent and Trademark Office (INPI) | National Plant Variety Protection Service (SNPC), under the Ministry of Agriculture and Livestock (MAPA) |
| Main requirements | Novelty, inventive step, and industrial application | Distinctness, uniformity, stability (DUS), and agronomic novelty |
| Term | 20 years from the filing date for invention patents | Generally 15 years; 18 years for grapevines and fruit, forest, and ornamental trees, including their rootstocks |
| Exceptions and own use | Limited exceptions (Article 43 of the Industrial Property Law): private, non-commercial use and scientific experimental research. Commercial replication or reuse of the technology is not authorized. |
Farmers’ privilege (Article 10, I of Law No. 9,456/1997): allows seeds to be reserved for the farmer’s own use exclusively in the following crop season, subject to applicable regulatory limits. |
Plant variety protection is granted by the National Plant Variety Protection Service, SNPC, and provides rights over the multiplication and commercial exploitation of the variety’s propagation material. A patent, by contrast, protects the technical solution that was invented.
Can the same seed be protected by both a patent and plant variety protection?
Yes, because the two rights apply to different dimensions of biological material. Plant variety protection covers the specific botanical variety developed by the breeder. A patent protects the specific molecular technology or genetic construct incorporated into that variety.
This interaction gave rise to one of the most significant legal debates in Brazilian agribusiness, which was ultimately settled by the Superior Court of Justice, STJ. The Court held that the provision of the Plant Variety Protection Law allowing farmers to reserve grain for replanting in the following crop season does not eliminate the enforceability of patent rights over the biotechnology incorporated into that material.
This is based on the principle that exhaustion of patent rights, provided for under Article 43, VI of the Industrial Property Law, ends with harvest for consumption or commercial grain purposes. The systematic biological replication of a seed generates a new generation of material containing the patented invention, constituting a new unauthorized reproduction of the technology if the corresponding remuneration is not paid.
How do royalties work in agribusiness?
Royalties are a form of remuneration paid in exchange for authorization to exploit certain intellectual property rights.
In agribusiness, royalties may be charged when certified seed is acquired or when the harvested crop is sold or delivered to a collection point or grain elevator, if the farmer chooses to use saved seed without previously paying for the technology.
It is therefore essential not to treat a royalty as though it were necessarily linked to a single patent.
A commercial technology may involve a package of rights, including multiple patents with different expiration dates, pending patent applications, plant varieties, trademarks, non-patented technical knowledge, or know-how, and other contractual obligations. The more complex the technology package, the more important it becomes to identify precisely what is being licensed and remunerated.
What happens when a patent expires?
In Brazil, an invention patent remains in force for exactly 20 years from its filing date, with no extensions arising from delays in administrative examination, as established by the Brazilian Supreme Court, STF, in ADI 5529.
Once this term expires, the specific invention enters the public domain. This does not, however, mean that the product becomes free from all restrictions. Other patents covering formulations or processes may remain in force, the corresponding plant variety may still be protected, and trademarks or confidential information remain subject to their own legal regimes.
Patent expiration must therefore always be assessed within the context of the entire intellectual property portfolio.
Does patent expiration mean the end of royalty payments?
The answer depends on the assets covered by the licensing agreement.
If remuneration is exclusively tied to a patent that has expired, royalty payments relating to that patent must cease. However, if the agreement covers other rights that remain in force, such as valid plant variety rights, remaining second-generation patents, trademarks, or know-how, remuneration may continue with respect to those assets.
Contractual drafting is therefore crucial. Agreements that refer generically to a “technology” may create uncertainty when one of the underlying rights expires. Individually identifying each asset and the corresponding portion of remuneration helps prevent future disputes.
What about patent applications that are still pending?
A considerable period of time may elapse between the filing of a patent application and its eventual grant. During this period, the applicant holds an expectation of rights.
The Brazilian Industrial Property Law provides for compensation for unauthorized exploitation occurring between publication of the patent application and the grant of the patent, but the enforceability of such compensation depends on the definitive grant of the patent by the INPI.
In licensing agreements entered into during this period, it is essential to establish what will happen to the remuneration if the application is rejected or if the resulting patent is granted with a different scope of protection.
What should be considered in agricultural technology licensing agreements?
A well-structured agreement provides legal certainty throughout the innovation cycle:
- Precise identification of rights: specify patent applications and granted patents, plant variety rights, trademarks, and the scope of any know-how involved;
- Provisions for changes in the portfolio: establish rules governing expiration, rejection, or invalidation of rights during the term of the agreement;
- Allocation of remuneration: identify the portion of the remuneration attributable to each asset;
- Recordal with the INPI: required for a patent license to produce effects against third parties, authorize the remittance of royalties abroad, and enable applicable tax benefits.
Regulatory approval and intellectual property are different matters
Another important aspect of agribusiness is the distinction between intellectual property and regulatory authorization.
Commercial approval of genetically modified organisms by the Brazilian National Technical Commission on Biosafety, CTNBio, and agricultural registrations before MAPA, IBAMA, and ANVISA assess biosafety and efficacy. They do not create market exclusivity against commercial copying.
On the other hand, Law No. 10,603/2002 provides regulatory data protection, preventing competitors from using confidential tests and data submitted for the registration of crop protection products and biological inputs for periods ranging from five to ten years.
This regulatory barrier is independent of patent protection and may remain in effect even after the patent has expired.
Public domain does not automatically mean freedom to operate
The expiration of a patent does not provide unrestricted authorization for the immediate commercialization of a product. The final product may still infringe active patents owned by third parties covering formulations, intermediate synthesis, or manufacturing processes.
To mitigate this risk, companies may conduct a Freedom to Operate, or FTO, analysis. This is a preventive assessment of the claims of third-party patents that remain in force in a particular country before investments are made in production or a commercial launch.
In agribusiness, where several technologies are often combined within a single product, this type of analysis can be particularly relevant before investments in production, product launches, or commercial expansion.
Where do disputes involving patents and royalties in agribusiness arise?
Conflicts may arise at different stages of a technology’s life cycle.
Some disputes involve the interpretation of agreements and the payment of royalties. Others concern potential patent infringement, the scope of patent claims, or the validity of the patent itself.
The nature of the dispute also determines which court has jurisdiction. In general, litigation is divided as follows:
- State Courts: hear patent infringement actions, claims involving improper royalty charges, and contractual disputes between private parties;
- Federal Courts: have exclusive jurisdiction over patent invalidity actions, which require the mandatory participation of the INPI.
Although patent invalidity may be raised as a defense before a State Court to prevent liability, the effects of such a finding are limited to the particular proceeding, inter partes. Definitive cancellation of the patent with effects against the market as a whole, erga omnes, can only occur in the federal courts.
From research to market: protection throughout the technology life cycle
An intellectual property strategy requires continuous management beginning at the research and development stage.
At this initial stage, the patentability of new solutions is assessed, compliance with SisGen requirements is ensured, and essential trade secrets are preserved before any disclosure to the market.
The protection stage then focuses on the technical and strategic drafting of patent claims, compliance with sufficient disclosure requirements, including international deposit of biological material under the Budapest Treaty where applicable, and the prosecution of plant variety protection applications before the competent authority.
When the technology reaches the field, properly defined licensing agreements, recordal of the relevant instruments with the INPI, and efficient management of royalty payments among partners and farmers become increasingly important.
Over the following years, the intellectual property portfolio must continue to be monitored. Patents are granted, applications may be rejected, new improvements are developed, and existing rights reach the end of their terms.
Finally, in the post-patent environment, conducting freedom-to-operate analyses and monitoring the transition of the portfolio toward next-generation innovations help ensure the safe and sustainable continuity of agricultural businesses.
The importance of appropriate intellectual property guidance
Protecting agricultural technologies requires an integrated understanding of patents, plant variety rights, agreements, and market strategy.
Ricci Intellectual Property advises companies, research centers, breeders, seed companies, cooperatives, and other organizations that develop or use technologies in agribusiness on the protection and management of intellectual property assets.
This work may include patentability assessments for new solutions, preparation and prosecution of patent applications, plant variety protection, portfolio and freedom-to-operate analyses, structuring of licensing and technology transfer agreements, recordals before the INPI, and monitoring the term and status of intellectual property rights.
In a sector where a single technology may involve multiple rights and agreements, understanding exactly what is protected, for how long, and under which conditions is an important part of an innovation strategy.
Assessing these factors in advance allows companies to structure investments, licenses, and product launches with greater legal certainty and to make more efficient use of the entire technology life cycle, from the laboratory to the field.
