The Biological Diversity Act, 2002 | Protecting and Sharing India's Biological Wealth

This is the 6th post in Environmental Law, Unit III — Legal Framework for Environment Protection (the previous post covered the Environment (Protection) Act, 1986). This post covers the Biological Diversity Act, 2002.

The Problem This Topic Solves

India is one of the world's biodiversity-rich nations, home to enormous genetic and biological wealth — medicinal plants, crop varieties, microorganisms — that foreign companies and researchers had, for decades, accessed and commercialised (patenting derivatives of neem, turmeric, and basmati rice being the most cited examples) without any benefit flowing back to India or to the local communities whose traditional knowledge often pointed the way to the resource's value. India's ratification of the Convention on Biological Diversity (CBD), 1992 (adopted at the Rio Earth Summit) committed it to conserve biodiversity, ensure sustainable use, and secure fair and equitable sharing of benefits from its biological resources — obligations Parliament implemented through this Act.

A Three-Tier Institutional Structure

The Biological Diversity Act, 2002 creates a three-tier regulatory structure, unusual among the statutes in this unit:

National Biodiversity Authority (NBA) (Section 8) — the apex national body, based in Chennai, which regulates access by foreign entities and grants approvals for IPR applications based on Indian biological resources.
State Biodiversity Boards (SBBs) (Section 22) — one per State, which regulate access by Indian citizens/entities for commercial utilisation and advise State Governments on conservation.
Biodiversity Management Committees (BMCs) (Section 41) — constituted by every local body (panchayat/municipality), which maintain People's Biodiversity Registers (PBRs) documenting local biological resources and associated traditional knowledge — the grassroots layer that gives the Act its practical reach.

The three-tier structure, national to local: National Biodiversity Authority (Section 8, Chennai) — regulates foreign access, approves IPR applications based on Indian biological resources → State Biodiversity Boards (Section 22, one per State) — regulate Indian citizens'/entities' commercial access, advise the State Government → Biodiversity Management Committees (Section 41, every panchayat/municipality) — maintain People's Biodiversity Registers, the grassroots documentation layer.

Access Control — Who Needs Whose Approval

Who	What they need	From whom
Foreign nationals/entities, NRIs, and body corporates with non-Indian participation (Section 3)	Prior approval before obtaining any Indian biological resource for research or commercial use, or before applying for IPR based on it	National Biodiversity Authority
Indian citizens/entities (Section 7)	Prior intimation (not approval) before obtaining a biological resource for commercial utilisation (research is exempt)	State Biodiversity Board
Anyone seeking an IPR based on Indian biological resources/associated traditional knowledge (Section 6)	Previous approval before the IPR is actually granted (application can be filed first, approval needed before grant)	National Biodiversity Authority

Section 21 requires the National Biodiversity Authority, while granting any approval under the Act, to ensure equitable sharing of benefits arising from the use of biological resources or associated knowledge — benefits which may take the form of monetary compensation, joint research ventures, technology transfer, association of Indian scientists/local communities in research, or setting up venture-capital funds. This benefit-sharing mandate implements India's obligations under the Nagoya Protocol on Access and Benefit-Sharing (2010), an international supplementary agreement to the CBD.

Illustrative application — the "biopiracy" problem the Act targets

Point of law: A foreign company seeking to obtain and commercially exploit an Indian medicinal plant's extract — particularly where its therapeutic use is already known through Indian traditional knowledge — must first obtain the National Biodiversity Authority's approval under Section 3, and any resulting patent application must independently secure Section 6 approval before grant, with benefit-sharing terms fixed under Section 21. Accessing the resource and filing for a patent without either approval is the paradigm case of unauthorised access this Act was designed to prevent — the very pattern documented in the neem, turmeric, and basmati controversies that preceded the Act.

Divya Pharmacy v. Union of India (Uttarakhand High Court, 2018) confirms that this benefit-sharing duty is not limited to foreign entities. Divya Pharmacy, an Indian company, argued that Section 7's "intimation" requirement for Indian entities meant no benefit-sharing was owed. The Court rejected this, holding that Indian companies extracting and commercially using biological resources are equally liable to share benefits with the local communities that conserved those resources — the protection the Act gives to indigenous and local communities applies "equally from outside as well as from within." For exam purposes: Section 7's lighter "intimation, not approval" requirement for Indian entities does not mean Indian companies are exempt from benefit-sharing — Divya Pharmacy is the authority that closes that argument.

The Biological Diversity (Amendment) Act, 2023

The 2023 Amendment made several significant changes:

Indian-controlled companies (even with some foreign shareholding, so long as control remains Indian) are no longer treated as a "body corporate, association or organisation" requiring NBA approval under Section 3 — easing compliance for genuinely Indian-controlled enterprises.
A new IPR-registration requirement: an Indian national/entity applying for an IPR (in India or abroad) based on research involving Indian biological resources or associated traditional knowledge — including resources deposited in repositories outside India — must register with the NBA before the IPR is granted.
Decriminalisation under amended Section 55: imprisonment for contraventions was replaced with monetary penalties ranging from Rs. 1 lakh to Rs. 50 lakh (with an additional penalty of up to Rs. 1 crore for a continuing contravention), aligning this Act with the broader ease-of-doing-business decriminalisation trend seen in the Water, Air, and Environment (Protection) Acts.
AYUSH practitioners using traditional medicine were given specific relief from certain benefit-sharing and access requirements, recognising the routine, non-commercial nature of much traditional medical practice.
A new Section 36A requires monitoring of biological resources obtained from foreign countries for use in India, aligning domestic practice with Nagoya Protocol reciprocity.

Must Know

Governing Act: Biological Diversity Act, 2002, implementing India's obligations under the CBD, 1992 and (via 2023 amendment) the Nagoya Protocol.
Three tiers: NBA (national, Chennai) → State Biodiversity Boards → Biodiversity Management Committees (local, maintain People's Biodiversity Registers).
Section 3: foreign entities need NBA approval; Section 7: Indian entities need only SBB intimation for commercial use; Section 6: NBA approval needed before any IPR grant based on Indian biological resources.
Section 21: mandatory equitable benefit-sharing on any approval granted.
2023 Amendment: exempted Indian-controlled companies from Section 3; added IPR-registration duty; decriminalised Section 55 offences (penalties Rs. 1 lakh – Rs. 50 lakh); relief for AYUSH practitioners; new Section 36A on foreign-resource monitoring.

A Practical Example

A foreign pharmaceutical company wants to research a compound derived from a plant native to the Western Ghats, based on leads from local traditional healers' knowledge, and eventually patent the resulting formulation. Under Section 3, the company must first obtain the National Biodiversity Authority's approval before accessing the plant for research; if it proceeds to seek a patent, Section 6 requires separate NBA approval before the patent can actually be granted; and under Section 21, the NBA will fix benefit-sharing terms — which could include royalty payments or research collaboration — before finalising its approval, ensuring the source community and India as a whole receive a share of any resulting commercial value.

Quick Revision Points

Biological Diversity Act, 2002 implements the CBD, 1992 (Rio Earth Summit) and, since 2023, the Nagoya Protocol.
Three-tier structure: NBA → SBB → BMC (maintains People's Biodiversity Registers).
Section 3 (foreign access, NBA approval) vs. Section 7 (Indian commercial access, SBB intimation only) vs. Section 6 (IPR grant, NBA approval).
Section 21: mandatory benefit-sharing on any grant of approval.
2023 Amendment: Indian-controlled companies exempted from Section 3; new IPR-registration duty; Section 55 decriminalised (Rs. 1 lakh–Rs. 50 lakh penalty); AYUSH relief; new Section 36A.
Next post: hazardous waste management law.

6. The Biological Diversity Act, 2002 | Protecting and Sharing India's Biological Wealth