European liability models - Implementation in various states

The EU member states have implemented the directive — if at all — in various ways. Generally speaking, however, two models are emerging: some countries, like the Netherlands and Denmark, have decided on a combination of liability based on the fault of the farmers that cultivate GM crops and liability funds which indemnify losses occurring as a result of the proper cultivation of GM crops.

Other countries, like Germany and Austria, have extended the liability for GM crops to a degree that more or less prohibits their cultivation.

The Dutch liability model

In 2004, stakeholders in the Netherlands (farmers, seed manufacturers, processing firms, etc.) came to an agreement on the cultivation of genetically modified maize, potatoes, and sugar beet.

Farmers who keep to these rules are not liable. If cross-pollination occurs in spite of the coexistence rules being observed, conventional farmers are indemnified from a special fund to which all stakeholders and, initially, the state contribute (Fig. 1).

The German liability model

In Germany, on the other hand, farmers that cultivate GM crops are liable whether they are at fault or not — even if they have observed all the rules of best practice (Germany's Genetic Technology Act, GenTG § 36a, in conjunction with the general civil laws governing the interests of neighbours, especially § 906 BGB).

Each farmer is also jointly and severally liable together with the other farmers that cultivate GM crops in the region even if it cannot be established whose plants were responsible for the mixture. It is still uncertain whether accidental cross-pollination only leads to liability if the legal threshold is exceeded or whether it is enough for a lower threshold to be exceeded that has been contractually agreed upon by conventional farmers and their customers.

On account of this strict liability, insurance for the cultivation of GM crops and its incalculable risks is considered unfeasible in Germany at present. However, an amendment of the GenTG is part of the coalition pact that was agreed following the change of government in the autumn of 2005. A liability ruling is envisaged similar to the one in the Netherlands, although the fund will be replaced in the long term by an insurance solution. State participation in this fund is not planned (Fig. 2).

Conclusion

As the legal situation in the EU has not yet been standardised, there is a great deal of uncertainty in the majority of European countries as to the dangers and liability risks that the cultivation of GM crops involves.

Will the insurance industry contribute towards solving the problems connected with the coexistence rules in these countries too? Or should this be left initially to the equalisation funds? This will only be decided when liability for the cultivation of GM crops is subject to regulations in line with the above directive.