72 



It should be noted that the farm-saved seed provision in the new convention does 

 not permit the selling of farm-saved seed. In order to be in full compliance with the 

 convention, S. 1406 contains a provision that stipulates that sales of protected varie- 

 ties of seed are dependent on permission granted by the owner of the protected vari- 

 ety. 



It has become increasingly apparent that of all the issues before this subcommit- 

 tee, the most widely discussed component of S. 1406 has centered on this provision. 

 The sale of farm-saved seed has led to the abandonment of research programs on 

 certain crops by seed companies because of an inability to compete with their own 

 varieties. Time considerations preclude going into graphic detail of the casualties re- 

 sulting from farm-saved sales. This subcommittee, however, will be receiving and in- 

 corporating into the official record documented cases of seed companies, large and 

 small alike that have restructured, curtailed, and in the most drastic of examples, 

 abandoned major research programs. All of these actions illustrate a painful, but 

 necessary recognition by seed companies of an inability to compete with farmers 

 capitalizing from substantial financial, human, and research commitments. 



A surprising few believe that a variety granted a PVP certificate is just that — a 

 PVP certificate. The seed industry, however, views the PVP certificate as a "patent- 

 like" license that ensures protection and a recognition of development worthy of ex- 

 pected rights and privilege. The NCCPB fully supports the tradition and spirit of 

 the crop exemption. We do not, however, believe that breeders, whether public or 

 private, individual or university, have to expect or accept anything less than full 

 protection. The UPOV Convention permits sales contingent on the permission of the 

 owner of the protected variety. This standard is in keeping with the intent of the 

 PVP certificate and is most importantly, fair and consistent to those who assume 

 the risk and investment. 



While S. 1406 will provide this crucial protection to the developer, the benefit ex- 

 tends to the farmer. Farmers need to know that the industry that provides them 

 with the single most important component in agriculture is firmly committed to 

 bringing to the market a steady stream of improved and enhanced seed. Without 

 newer and improved varieties, American farmers cannot compete with our competi- 

 tors overseas. If our competitors recognize the value and necessity of protecting 

 breeders' rights and we, in turn, fail to do so, our ability to continue dominating 

 agricultural markets will be in serious question. S. 1406 seeks to better position 

 American agriculture by giving those who develop the seed protection and those 

 who utilize the seed selection they have come to know and expect. 



These changes as reflected in S. 1406 are necessary for the continued health and 

 stability of American agriculture. Acceptance and adherence to the 1991 UPOV 

 Convention is in the best interest of all of us who are committed to the farmer and 

 to the breeder. 



Like any business or area of intellectual property, protection and incentive go 

 hand in hand. Risk of capital and market share is real. An inability to protect runs 

 contrary to the spirit of the UPOV Convention and our ability as an industry to 

 foster a partnership with farmer. Seed companies must know that their investment 

 of time, research, and capital is truly protected, without exception. 



STATEMENT OF PIONEER HI-BRED INTERNATIONAL, INCORPORATED 



Mr. Chairman and members of the subcommittee. My name is Owen J. Newlin 

 and I am here today representing Pioneer Hi-Bred International, Inc. I am member 

 of the Board of Directors and have recently retired as senior vice president, where I 

 was responsible for finance, information management, human resources and produc- 

 tion of the North American Seed Division. 



Mr. Chairman, we commend you for holding this hearing on the proposed amend- 

 ments to the Plant Variety Protection (PVP) Act. We also want to commend you 

 and Senator Kerrey for introducing this much needed legislation. We are pleased to 

 provide the subcommittee with Pioneer's perspective on the need to update the PVP 

 Act and offer our suggestions to further strengthen the legislation that has been 

 introduced. 



Let me begin by telling you a little bit about Pioneer. Pioneer was founded in 

 1926 by Henry A. Wallace and a few of his colleagues. He later went on to become 

 U.S. Secretary of Agriculture and Vice President. Today, Pioneer is one of the 

 world's largest independent agricultural genetic supply companies, doing business in 

 more than 60 countries. 



Pioneer breeds, produces and sells hybrid corn, hybrid sorghum and hybrid sun- 

 flower seed, and pure-line varieties of soybean, Soft Red Winter wheat and alfalfa 



