Brazilian court suspends Bayer's royalties reimbursement for Intacta

A preliminary injunction has been granted by the Brazilian judiciary, suspending Bayer's reimbursement of royalties paid by soybean farmers who purchased Intacta genetically modified soybean seeds.

The German multinational confirmed in a statement to stakeholders that it managed to overturn the first-instance ruling issued by Judge Celia Regina Vidotti in December 2024. 

Bayer provided the following statement to AgroPages: 

"Bayer has appealed the decision of the First Instance Court Judge, which aims to amend the terms of certain patents related to the INTACTA RR2 PRO^® soybean technology, as well as the decision on the merits of the case.

Recently, the company succeeded in obtaining a suspension of the effects of these decisions until the Appeals Court reviews the case. This outcome preserves the current status quo, ensuring that the core principles of our business model, including the legal testing and collection system at Points of Delivery (PODs), remain unchanged while the appeal is pending.

Bayer trusts in the robustness of the legal system that protects intellectual property rights. The INTACTA RR2 PRO^® technology is protected by intellectual property rights, including granted and valid patents in Brazil and abroad."

The German company has been engaged in a lengthy legal battle in Brazilian courts to protect the royalties of its genetically modified soybeans. One of Bayer's main opponents in this legal process is the Mato Grosso Soybean and Corn Producers Association (Aprosoja-MT). According to Sidney de Souza, the association's lawyer, Bayer has provided BRL 4.5 billion in "judicial guarantees" while two of these cases are ongoing.

The Brazilian Supreme Federal Court (STF) decided two years ago that patent rights could not be extended beyond 20 years from the filing date. "The judge applied the Supreme Federal Court's decision in our case, corrected the patent terms, and ordered the return of royalties paid unduly," Souza said about the Mato Grosso court's decision, which has now been suspended by the injunction.

According to Anderson Nacaxe, CEO and Co-Founder of Oken Finance, this decision involves billions of reais and "profound impacts on the Brazilian soybean sector": "In practice, if the producers are victorious, they could recover between BRL 1.3 billion and BRL 10 billion paid after the patents expired in 2018 and 2020, significantly reducing their production costs."

"According to market studies, this would represent a reduction of up to 20% in seed costs, strengthening Brazil's competitiveness against countries like Argentina and Paraguay, which pay lower royalties on expired technologies," Nacaxe analyzes.

On the other hand, he notes, Bayer argues that charging royalties is essential to fund continuous innovation, ensuring investments in research that increase agricultural productivity. The company maintains that the patents were valid during the charged period and warns that retroactive changes to the rules undermine the legal certainty necessary for agribusiness investments.

"The discussion goes beyond the legal realm: it is a debate about the balance between intellectual property and the economic sustainability of Brazilian farmers. After all, where is the limit between protecting technology investment and the farmers' right to fair access to technologies whose patent terms have expired? This decision could set important precedents for the future of the national agribusiness," the expert concludes.

(Editing by Leonardo Gottems, reporter for AgroPages)