May 26, 2016

Monsanto suspends release of new soybean seeds in Argentina

US seeds company Monsanto said it is suspending the launching of any future soybean technologies in Argentina, including Roundup Ready 2 Xtend™ soybeans, following failed talks with the government related to the collection of royalties from new patented soybean technologies.

"We were optimistic that a solution would be secured to allow the legally operating soybean technology royalty system to continue uninterrupted following recent discussions between the Ministry of Agriculture for Argentina and the soybean industry stakeholders," said Brett Begemann, Monsanto president and chief operating officer.

"While the government of Argentina has acknowledged to us that they were committed to supporting a conducive environment for continued investment and further long-term development of agriculture through recognition of intellectual property rights and a recognition of private agreements, the recent actions are not consistent with that position. Both endorsing and actively supporting these basic principles are necessary to create a predictable business environment, which invites foreign investment", Mr. Begemann added.

During the talks, the soybean industry stakeholders heard the Minister of Agriculture's concerns with the existing system, which has been legally operating for more than a year, and responded with several proposals. Monsanto, however, expressed disappointment that the parties were unable to come to a mutually agreeable solution.

"While Monsanto is concerned that the recent government actions may adversely affect its private agreements, the company remains committed to engage in dialogue with the government of Argentina to try and find a solution that will help encourage and spur new investments in Argentina," Begemann said.

Monsanto said the current soybean technology royalty system that applies to Intacta RR2 Pro soybean technology is legal, as Intacta RR2 Pro is a biotechnology invention that is protected in Argentina and other countries around the world by patent rights owned by Monsanto and its affiliates.

The soybean technology royalty system is in place to ensure recognition of Monsanto's intellectual property rights and was designed within the framework of Argentine law and International Treaties.

The company said it is reviewing its business plans and projections for Argentina and would assess any implications to its balance sheet and earnings.