ABSTRACT
The Standard Material Transfer Agreement (SMTA), like any other material transfer agreement (MTA), is basically a contract setting out the terms and conditions under which material will be transferred between the provider and the recipient of the material. 1 While some of the parties to a particular SMTA may be state enterprises, the SMTA, like other MTAs, operates at the level of private contract law rather than international law. One of the basic principles of contract law is that a contract creates binding rights and obligations only as between the parties to the contract – this is known as the principle of privity of contract. The difference between the SMTA and a normal MTA is that plant genetic resources for food and agriculture (PGRFA) that are transferred under an SMTA are regarded as coming from the multilateral system on access and benefit sharing (multilateral system), and benefits under the SMTA flow not to the individual provider but to the multilateral system itself. 2 Once in the multilateral system, the benefits are to be passed on to farmers, particularly in developing countries, in order to finance further efforts to conserve and use PGRFA sustainably. In this sense, the multilateral system is the real beneficiary of the benefit-sharing provisions of the SMTA rather than the parties to the SMTA themselves. The SMTA recognizes this fact by providing for the appointment of a third party beneficiary to represent the rights of the multilateral system and by giving this third party beneficiary the power to initiate dispute settlement action, including arbitration, in the event of a breach of the terms and conditions of the SMTA affecting those rights. In so doing, the SMTA also solves one of the major problems affecting access and benefit-sharing agreements in general, namely the capacity of developing countries, or individual institutions in developing countries, to enforce the terms of these agreements.
