Navigating the South African Biotrade and Bioprospecting system with Parceval

26 Jul 2024 --- Although South Africa has established a rigid and cumbersome legal system governing access to indigenous biodiversity and associated traditional knowledge, Parceval has secured several permits. The South African-based distributor and manufacturer of herbal medicines and botanical extracts uses its experience to support international companies in their application process.

Nutrition Insight continues discussing how the company navigates the complicated system with Ulrich Feiter, Parceval’s CEO, and Avril Harvey, its special projects manager. This system is based on the Nagoya Protocol, a global legal framework to promote biodiversity and fair and equitable benefit-sharing with communities in the raw materials’ sourcing areas.

In last week’s first installment of this series on Biotrade and Bioprospecting in South Africa, Feiter and Harvey explained that companies must obtain permits for Discovery (R&D), Biotrade and Bioprospecting. 

Harvey highlights that although South African legislation and permit systems are complicated, they provide more clarity than many other countries. 

“From some regards, we’re a leader in terms of having everything in place, which makes some international companies maybe more happy to work with South Africa because there’s a clear system, even if it’s cumbersome.” 

Feiter adds that the system’s “only benefit” is its legal surety. There is a process to follow, which usually results in a five-year permit. 

“We have learned to deal with it. Although the rigidity is there, you can make amendments once a year, on the anniversary of your permit being issued, that’s when you’re allowed to add another supplier or something,” he emphasizes. 

“Then you have to wait for that to be granted.” 

Flexibility in the system 
At the same time, Harvey appreciates the flexibility of the department in charge of the permit system. “They know, and they acknowledge that it does take a long time, and they say — business must continue, you must continue doing what you’re doing.” 

“Customs isn’t going to grab your stock at the port,” she underscores. “We’re not stopping you from doing anything. There’s been quite a long transition period they’ve allowed to come into the system.” 

Harvey says there is some flexibility if the government hasn’t prescribed a traditional knowledge holder (Image credit: Ulrich Feiter/Parceval).Meanwhile, she observes that international companies are getting more pressure from auditors, nature conservation organizations and other stakeholders who don’t understand the flexibility of applying for a permit and continuing operations before it’s been approved. 

“That’s now becoming a conflict, whereas our government has been quite flexible about the application.” 

Feiter welcomes the flexibility and hopes it will increase in the future, also for the benefit of the department handling the applications. “If everybody needs to have all these permits, the department has an avalanche of applications and they’re just a handful of people.” 

For example, he adds that the company obtained sector-wide agreements in Buchu (though not yet valid) and Rooibos, which is “strictly speaking, not foreseen in the Act and regulations.” 

International comparison
Parceval also has some experience with systems in other Southern African countries, such as Namibia and Zimbabwe. 

Feiter explains that Namibia has legislation, but it is not properly enforced, “and it’s not quite clear who needs to be approached in the government and who issues permits.” This system works well for existing resources such as Devil’s claw, but limits work with new materials.  

Meanwhile, Harvey notes that Zimbabwe has made some progress in its legal system for indigenous resources. 

“They don’t have a set process yet, but they are getting there. They work a little differently than in South Africa. We have more traditional councils and kingdoms where they have rural district councils, which are more like rural municipalities with local governance and bylaws.”

The legislation is finalized at the top level, with a statutory instrument, a decision-making steering committee and a final decision-making body. 

“They haven’t implemented the legislation in the bylaws for the rural district councils. Until they do that, they can’t enter into any benefit-sharing agreements or mutually agreed terms because they don’t have that structure yet. But they are working toward it.”  

In Zimbabwe, Parceval works with a company called Bio-Innovation Zimbabwe, which focuses on commercializing indigenous crops and aims to develop these bylaws at the real district council level. 

“I think they’re quite close to having something in place,” says Harvey. “Mozambique also contacted us. They sent a delegation to come and learn about how we are implementing things and we met with industry, government and traditional knowledge holders. We try to say — don’t implement a complicated system like South Africa.”

She adds that countries such as Brazil and India have gone for a more standardized system. “They’re not trying to have all those case by case basis and negotiations.” 

Mesembryanthemum tortuosum, or kanna, growing wild in South Africa (Image credit: Ulrich Feiter/Parceval).Navigating the system 
Parceval currently has 13 permits, of which around half are with international companies. Harvey notes that the company has also helped several companies get permits, for example, supporting Nektium in obtaining a Biotrade permit for Honeybush from South Africa. 

Also considering expired permits, she asserts that Parceval has conducted 25 to 30 applications over time and held 25 permits. 

Although the company has vast experience applying for and obtaining permits, she cautions that “we’re not the government. We can only base it on what we have experienced. We can’t give absolute certainty to companies and say you will get this permit.” 

For example, sometimes, the government requests that the company use a different type of application. 

“We don’t get it completely 100% right,” she continues. “But we certainly can assist with knowing what needs to be absolutely in place and other things where there’s flexibility.” 

“For instance, with traditional knowledge, there is some flexibility. For resources where the government hasn’t prescribed a specific traditional knowledge holder, we can sometimes get a permit issued without benefit sharing with the traditional knowledge holders. If you come in from overseas, you wouldn’t know that. You might think you have to try and find a traditional knowledge holder and sign an agreement with somebody, somewhere.” 

She explains that permits can still be issued if there are no recognized traditional knowledge holders for a resource. 

“You ask the government to help you identify the traditional knowledge holder, and your permit gets issued with a condition that when a traditional knowledge holder is identified, you must sign an agreement.”

Acceptable benefit sharing 
Moreover, Feiter highlights that Parceval’s experience obtaining permits, seeing many different permutations of permits and discussions with other industry players have given the company an overview of what is acceptable regarding benefit sharing. 

“That is important because everybody, including the government, is trying to demand more and more from you as a user of the resource. We say this is how far we are prepared to go; if not, we walk away. Certain things are just not possible. We push back and say we’re not going to go there.” 

He adds that this is also the role of a newly created industry addition, the South African Botanical Products Association (SABPA), helping to obtain more sector-wide agreements so there is a more level playing field regarding benefit sharing instead of “outrageous demands.” 

SABPA was developed last year by Parceval and other stakeholders, with funding from GIZ. 

The South African government has been increasing its attempts to enforce the legislation, urging companies to become compliant.This organization aims to develop the Sceletium (Sceletium tortuosum or Kanna) sector alongside other indigenous biological resource sectors. 

“We are also reaching out to other people — we want to capture and build a home for all the other botanicals so that not every botanical needs to form a new association.”

Increased enforcement 
South Africa’s legislation on indigenous resources and traditional knowledge can only be enforced locally. The government has been increasing its attempts to enforce the legislation, such as sending compliance auditors to companies using indigenous resources.  

“Thus far, there have been no penalties or fines implemented, as far as I know,” adds Harvey. “They are sending teams around to the companies they have become aware of, giving them a chance to comply.”

The government started with larger companies that clearly use indigenous resources, such as Amarula, creating liqueurs and spirits based on the African marula fruit (Sclerocarya birrea). Harvey explains that the company received “a letter saying you must be compliant and have one year to become compliant. Those big commercial products were targeted first.” 

She adds that more of the smaller companies are being approached and audited. For example, companies use a ton or as little as 10 kg of a resource. “The government is holding their hands and giving them some time to become compliant.”

Although the government currently conducts a “hand-holding transition into compliance,” she expects that if the government approached a company several times without changing its operations, “we might start to see products being recalled or other penalties.”

By Jolanda van Hal