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Intellectual Property Rights - Law and Practice · Biological Diversity

Benefit Sharing and IPR under the Biological Diversity Act, 2002

Updated 11 October 2026 · Fact-checked

Benefit sharing means the NBA must ensure that users of Indian biological resources and associated knowledge share the benefits fairly with benefit claimers, on mutually agreed terms (Section 21). IPR over inventions based on such resources needs NBA approval or registration under Section 6. You solve questions by applying the section to the facts.

Understand Benefit Sharing and Intellectual Property Rights

India's biodiversity has commercial value. Companies use plants, microbes and traditional knowledge to develop drugs, foods and cosmetics. The Act asks a simple question: if someone profits from our resources, who shares in that profit? This is the idea of access and benefit sharing, in line with the Convention on Biological Diversity and the Nagoya Protocol.

Under Section 21(1), the National Biodiversity Authority (NBA) must make sure that the terms of any approval secure fair and equitable sharing of benefits from the use of accessed biological resources, their derivatives, innovations and practices, and related knowledge. The terms are mutually agreed between the applicant and the Biodiversity Management Committee, which is represented by the NBA. The words "fair and equitable" were put in by the 2023 amendment, effective 1 April 2024.

Section 21(2) lists the ways benefit sharing can be given effect. These are: joint ownership of IPR with the NBA or with identified benefit claimers; transfer of technology; locating production, research and development units in areas that improve living standards of benefit claimers; associating Indian scientists, benefit claimers and local people with research and development, bio-survey and bio-utilisation; a venture capital fund for benefit claimers; and monetary compensation and other non-monetary benefits as the NBA thinks fit. Money ordered can be directed to the National Biodiversity Fund. Where the resource or knowledge came from an individual, group or organisation, the NBA may direct payment straight to that benefit claimer.

The IPR link is Section 6. A person or entity covered by Section 3(2) who applies for an IPR, in or outside India, for an invention based on research or information on a biological resource accessed from India (including resources held in repositories outside India) or associated traditional knowledge, needs prior NBA approval before the IPR is granted. Persons covered by Section 7 must register with the NBA before grant, and must get prior approval at the time of commercialisation if they already hold the IPR. While approving, the NBA may impose a benefit sharing fee, royalty or both, or other conditions including sharing of financial benefits from commercial use.

Two limits matter. Section 6 does not apply to applications under the law on protection of plant varieties, but the authority granting such a right must send a copy to the NBA. Also, under Section 18(4), the NBA can act for the Central Government to oppose IPR grants abroad on Indian biological resources or associated knowledge.

Key rules to remember

Benefit sharing duty (Section 21(1))
Approval terms must secure fair and equitable sharing, on mutually agreed terms between applicant and BMC (represented by NBA)
Benefits arise from accessed resources, derivatives, innovations, practices and related knowledge.
Modes of benefit sharing (Section 21(2))
Joint IPR ownership | technology transfer | location of R&D units | association of scientists and local people | venture capital fund | monetary and non-monetary benefits
Applies subject to regulations. The Act uses 'all or any' of these, so the NBA can choose one or more.
Deposit of money (Section 21(3))
Money ordered → National Biodiversity Fund; direct payment to benefit claimer allowed under the proviso
Direct payment applies where the resource or knowledge was accessed from an individual, group or organisation.
IPR rule (Section 6(1))
Section 3(2) person applying for IPR → prior NBA approval before grant
Covers IPR in or outside India, and resources in overseas repositories.
Section 7 persons (Sections 6(1A), 6(1B))
Register before grant of IPR; prior approval at commercialisation if IPR already obtained
Section 19(2A) repeats this.
Fee or royalty (Section 6(2))
NBA may impose benefit sharing fee, royalty or both, or conditions
Sharing of financial benefits from commercial use of the rights.
Plant variety exception (Section 6(3), 6(4))
Section 6 not applicable to plant variety protection applications; granting authority endorses a copy to NBA
Do not state it as a complete exemption from the Act.

How to solve Benefit Sharing and Intellectual Property Rights questions

Use the same sequence for any case or theory question on benefit sharing and IPR.

  1. 1Identify the person: is the applicant covered by Section 3(2) (non-citizen, non-resident Indian, foreign-linked body) or by Section 7?
  2. 2Identify the subject matter: an invention based on research or information on a biological resource accessed from India, or associated traditional knowledge.
  3. 3State the stage: applying for IPR, already granted IPR, or about to commercialise.
  4. 4Apply Section 6: prior approval, registration, or approval at commercialisation, as the person and stage require.
  5. 5Apply Section 21: say how the NBA determines benefit sharing on mutually agreed terms and list the suitable modes.
  6. 6Check money and exceptions: National Biodiversity Fund, direct payment to the benefit claimer, and the plant variety carve-out.
  7. 7Conclude clearly: whether approval was needed, what the NBA can impose, and the practical compliance step.

Quickest way: Who, what, when, how shared

When to use it: Use it for short-answer or case questions with little time.

  1. Who: Section 3(2) person or Section 7 person?
  2. What: invention based on Indian resource or associated knowledge?
  3. When: before grant, at registration, or at commercialisation?
  4. How shared: pick the Section 21(2) modes that fit the facts.
  5. Close with fee or royalty under Section 6(2) and the NBA's discretion.

Common mistakes in Benefit Sharing and Intellectual Property Rights

  • Saying NBA approval is needed after the IPR is granted

    Students mix up the stages.

    Fix: For Section 3(2) persons, approval is before grant. Approval at commercialisation applies to Section 7 persons who already hold the IPR.

  • Treating benefit sharing as only a money payment

    Royalty is the most familiar form.

    Fix: List all Section 21(2) modes, including joint IPR ownership, technology transfer, scientist association and venture capital fund.

  • Ignoring resources held in foreign repositories

    Students think the Act covers only resources physically in India.

    Fix: Section 6 expressly includes resources accessed from India that are deposited in repositories outside India.

  • Claiming plant variety applications are fully outside the Act

    Section 6(3) is read in isolation.

    Fix: Only Section 6 does not apply to them. The granting authority must still endorse a copy of the grant to the NBA under Section 6(4).

  • Saying the NBA imposes terms unilaterally

    Focus on the NBA's powers.

    Fix: Section 21(1) speaks of mutually agreed terms between the applicant and the BMC, represented by the NBA.

  • Forgetting the 2023 amendment

    Older notes use the earlier text.

    Fix: Write 'fair and equitable' and mention the Section 6(1A) and 6(1B) registration and commercialisation rules, effective 1 April 2024.

Worked examples

Example 1

A foreign pharmaceutical company develops a herbal formulation from a plant accessed from India and plans to file a patent application abroad. Advise on the Biological Diversity Act, 2002.

Show the solution
  1. Provision: Section 6(1) requires a Section 3(2) person applying for an IPR, in or outside India, for an invention based on a biological resource accessed from India to obtain prior NBA approval before grant.
  2. Facts: the company is a foreign body corporate, so it is covered by Section 3(2). The invention is based on a resource accessed from India. The filing is abroad, which Section 6 expressly covers.
  3. Analysis: it must apply to the NBA under Section 19(2). The NBA may approve with conditions, including a benefit sharing fee or royalty under Section 6(2), and decides benefit sharing under Section 21.
  4. Conclusion: the company must get NBA approval before the patent is granted. Benefit sharing terms will be set on mutually agreed terms.

Answer: Prior NBA approval is required before grant, even for a foreign filing. The NBA may impose a fee, royalty or both, and determine fair and equitable benefit sharing.

Example 2

The NBA grants approval to a company using a medicinal plant knowledge of a tribal community. Explain how benefit sharing may be given effect.

Show the solution
  1. Provision: Section 21(1) requires fair and equitable sharing on mutually agreed terms with the BMC, represented by the NBA.
  2. Modes under Section 21(2): joint IPR ownership with identified benefit claimers; technology transfer; R&D units located to improve the community's living standards; involving local people and Indian scientists in research; a venture capital fund; monetary and non-monetary benefits.
  3. Money: under Section 21(3) the NBA may direct the amount to the National Biodiversity Fund. Where the knowledge came from an individual, group or organisation, it may direct payment directly to that benefit claimer.
  4. Conclusion: the NBA chooses the mix that suits the facts, subject to regulations and guidelines.

Answer: The NBA may use any or all of the Section 21(2) modes. Money may go to the National Biodiversity Fund, or directly to the community as benefit claimer under the Section 21(3) proviso.

Exam tips

  • Quote Section 21(1) and 21(2) by number in theory answers. Examiners reward the exact list of modes.
  • In case questions, first label the person (Section 3(2) or Section 7) and the stage, then apply Section 6.
  • Mention the 2023 amendment and its effective date of 1 April 2024 when discussing registration and commercialisation approvals.
  • Close with a compliance point: apply to the NBA, record the agreed terms, and keep the approval details ready, since the NBA places them in the public domain under Section 19(4).

Practice questions from Biological Diversity

Benefit Sharing and Intellectual Property Rights in other exams

The same ground in other exams, if you are preparing for more than one or want another angle on it.

Benefit Sharing and Intellectual Property Rights: frequently asked questions

What is benefit sharing under the Biological Diversity Act, 2002?

It is the fair and equitable sharing of benefits that arise from using Indian biological resources, derivatives and associated knowledge. The NBA secures it through the terms of approval, based on mutually agreed terms. Section 21 sets out the modes.

Is NBA approval needed before applying for a patent on a biological resource from India?

A Section 3(2) person needs prior NBA approval before the IPR is granted. A Section 7 person must register before grant and obtain approval at commercialisation. This applies to IPR in or outside India.

Who are benefit claimers?

They are the people or groups entitled to share in the benefits, such as holders of the knowledge or resource. The NBA may pay them directly where the resource or knowledge was accessed from them, as the Section 21(3) proviso says.

Can the NBA oppose a foreign patent on an Indian biological resource?

Yes. Section 18(4) allows the NBA, on behalf of the Central Government, to take measures to oppose the grant of IPR in any country outside India on a biological resource found in or brought from India, or its associated traditional knowledge.