What is royalty and why must I pay it ?
Royalty is a fixed amount or a percentage of the sale value of a plant that returns to the holder of the intellectual property of the variety. The intellectual property is set according to strict standards, defined by legal firms specialized in the field. A new variety becomes an " invention " and is set within a patent filed at the Plant Breeders Right Office. After a detailed examination, it is accepted as being new and it is then assigned a number of plant breeders. It goes without saying that this whole process is not free.
The system of royalty is a way for developers of varieties, private or public geneticists to generate revenue to cover the costs of development of varieties and to fund the development of future varieties. The development of a variety is a lengthy process that can take 10 years from the time or the crossing is made.
The development of new varieties is necessary to improve the agricultural competitiveness of producers, fight against the diseases and insects and increase the quality of cultivated fruits. There is no variety of fruit plant far in trade which is a product of genetic, or genetically transformed (GMOs).
Nurseries are bound by contract with the holders of the intellectual property and royalty rates are set within these contracts. Contracts are better known under the name of license. A license may be exclusive or not, according to the agreements with the holder of the intellectual property. The license gives the right to the nursery to either sell or multiply and sell the variety in a given territory for a defined time period. In return the nursery is committed to collect a fee or royalty for each plant sold. This amount of money is returned to the holders of the intellectual property under the terms of the license.