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Australasian Biotechnology (backfiles)
AusBiotech
ISSN: 1036-7128
Vol. 8, Num. 5, 1998
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Regulatory Issues
Australasian Biotechnology,
Volume 8 Number 5, September/October 1998, pp. 299-302
Regulatory Issues
Biotechnology Under the Spotlight - The Hazardous Substances and
New Organisms Act - 1996
Mark Christensen/Martin Williams,
Russell McVeagh McKenzie Bartleet & Co, PO Box 8, Auckland, New Zealand
Code Number:AU98038
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This article examines the potential impact of the new Hazardous Substances and New
Organisms Act 1996 on the biotechnology industry in New Zealand. The purpose of the paper
is to provide an overview of the Act and, in particular, the need to obtain approvals under the
Act for genetic modifications. The procedures for processing of applications for approval are
explained. In particular, the implications of the extent of public involvement in the decision
making process for the industry are outlined, along with the approach the industry should take
in this new regulatory environment in light of public concerns about biotechnology, and in
particular genetically-modified foods. It is argued that, provided the right approach is taken,
the biotechnology industry should be able to take full advantage of this robust regulatory
system, to ensure that the benefits which the industry can provide to the economy are realised,
and the profile of the industry is enhanced.
Introduction
Since 29 July 1998, genetic modifications in New Zealand have required approvals
under the Hazardous Substances and New Organisms Act 1996 ("HSNO"). With the
introduction of this legislation, New Zealand now has arguably one of the most credible and
robust regulatory systems in the world enabling the development, field testing and release of
genetically-modified organisms ("GMOs").
This article explains the purpose and scope of the new legislative regime, and the
procedure for obtaining approvals under HSNO.
A key feature of HSNO is the requirement that most applications be publicly notified and
that a public hearing be held if requested by submitters. Most advanced regulatory systems are
now implementing or heading towards a regime that involves this sort of public participation.
While such a system might appear disadvantageous when compared with a selfregulated and
nonpublic process, provided the system is transparent and credible, and that approvals can be
obtained in a timely and cost- effective manner, the resulting approvals under such a public
system can form an important part of a biotechnology company's strategy for the approval and
marketing of a product worldwide.
There can be no suggestion that obtaining an approval for a GMO under HSNO is easy.
However, that is not the point. The new HSNO regime exhibits both transparency and
credibility. Importantly, the Act provides that approvals are to be granted or declined within 4
months of applications being lodged, even where the application is notified, and a public
hearing held. Coupled with the relatively low cost of undertaking research and development in
New Zealand, the relatively low costs of the approval process itself, and the high calibre of the
country's research institutions and biotechnology companies, New Zealand now has the
opportunity to rival and surpass a number of other countries in providing an environment
which fosters the development of biotechnology both domestically and internationally.
However, opposition can be expected. Readers may recall the article in the May/June
1998 issue of Australasian Biotechnology where a study relating to public perceptions
about gene technology was discussed (Muggleston, 1998). That study identified public
concerns about (in particular) genetically-modified foods. Recently in New Zealand, an
organisation calling itself RAGE (Revolt Against Genetic Engineering) was established to
"keep the New Zealand food supply free of GMOs".
These public concerns, many of which stem from misunderstandings about biotechnology,
need to be addressed by industry. This article therefore also discusses the strategy which
applicants should adopt to ensure that New Zealand can continue to take advantage of the
social and economic benefits which the biotechnology industry provides.
The HSNO approval process, if managed by industry in the right way, could be of
significant assistance in communicating the benefits of the technologies to the wider public.
The objective is to obtain through this process internationally credible and robust approvals
which will complement and strengthen New Zealand's already fine international reputation as a
source of high quality biological material.
Scope of the Act - GMOs
As its name implies, HSNO covers two main areas: hazardous substances and new
organisms. HSNO prohibits the development, field testing, importation or release of any new
organisms, including GMOs without approval.
"Genetically-modified organism" is defined in the Act as:
Any organism in which any of the genes or other genetic material -
- have been modified by in vitro techniques; or
- are inherited or otherwise derived, through any number of replications, from any genes or
other genetic material which has been modified by in vitro techniques.
Organism is defined to include:
- a micro-organism;
- a genetic structure, other than a genetic structure derived from a human being, that is
capable of replicating itself, whether that structure comprises all or only part of an entity, and
whether it comprises all or only part of the total genetic structure of entity;
- a reproductive cell or developmental stage of an organism.
These very wide definitions, on their own, would give HSNO very broad application in
terms of the need to obtain approvals. At the most extreme, approval would be required for all
laboratory work involving manipulation of any self replicating genetic structure. However, the
scope of HSNO has been limited by regulations which exempt certain technologies (for
example, organisms modified by the movement of nucleic acid using physiological processes)
which might otherwise have been caught by the legislation.
Environmental Risk Management Authority
Applications for approval are made to the newly established Environmental Risk
Management Authority ("ERMA"). When deciding applications, ERMA is required to give
effect to the purpose of the Act, set out in s4, which states that:
The purpose of this Act is to protect the environment, and the health and safety of
people and communities by preventing or managing the adverse effects of hazardous
substances and new organisms.
This purpose statement reflects the precautionary nature of the legislation, in the sense of
creating a presumption that approval is necessary, in order that risks associated with new
organisms can be assessed in advance.
ERMA has a range of functions under HSNO (including overseeing enforcement). Its
most important responsibility is the assessment of hazardous substances and new organisms,
and the setting of suitable controls on hazardous substances and new organisms approved for
use. In this way, ERMA is the New Zealand "equivalent" of Australia's Genetic Manipulation
Advisory Committee ("GMAC"). However, the most obvious difference to GMAC is that
ERMA has decision making powers, rather than being an advisory body.
Focus on Effects
An applicant for an approval is required to supply a comprehensive range of
information, including identification of the organism, experimental procedures to be used,
information on all the possible adverse effects of the organism on the environment, and
information on prior approvals in overseas jurisdictions. There are also a relatively complex set
of statutory criteria which must be considered by ERMA and addressed in the application.
At the end of the day, however, the focus of the application and ERMA's decision is on
the effects involved, both positive and negative. ERMA may, in its discretion, approve an
application if the positive effects of the organism outweigh the adverse effects or, conversely,
decline it if it considers that the adverse effects of the organism outweigh the positive effects.
ERMA is also required to consider the potential for the organism involved to create an
"undesirable self-sustaining population".
It is the applicant's task to persuade ERMA that the application has merit, that any risks
are outweighed by the potential benefits involved such that the application can be granted. The
applicant also needs to implement strategies to ensure that public perceptions about the risks
involved are addressed and that ERMA is not mislead by claims as to potential risks which are
not founded on credible scientific evidence.
An early decision should be made as to whether the application is likely to raise public
concern or involve significant potential adverse effects which submitters may seek to rely on in
opposing the application, or which may be of concern to ERMA. There are a number of steps
which an applicant can then take which, depending on the circumstances, can smooth the path
to obtaining an approval.
Dealing with ERMA
Establishing a point of contact at ERMA before lodging the application is very
important. If ERMA is not satisfied with the level of information provided, or is itself
concerned about potential (and even unidentified) risks then the applicant should work with
ERMA directly to address any such concerns by providing more information and discussing
the issues involved.
ERMA may decline an application if there is insufficient information on which to assess
the risks and benefits involved, and delay processing of the application until further
information is supplied, or while it consults with relevant state agencies to obtain that
information. Establishing a good relationship with ERMA and being as forthcoming as
possible is obviously an advantage. The applicant can also use this opportunity to explain any
areas of commercial sensitivity about the information supplied to ERMA, enabling it to obtain
the maximum amount of protection for that information.
Processing of Application - Public Involvement
As noted, a distinctive feature of the Act is the public notification of most
applications, providing the opportunity for public involvement in the decision making process.
This is similar to the public notification of this type of application by GMAC, along with
subsequent public involvement in the processes leading to approval for genetic modification in
Australia, although different notification procedures are involved because of ERMA's decision
making rather than advisory role.
An exception from notification in New Zealand relates to applications for the development
of a GMO in containment, where certain low risk criteria (set in regulations) are met. These
criteria relate to the Physical Containment Conditions, specified in the Australian/New Zealand
Standard2243.3 for "Safety in Laboratories", Part3: Microbiology (CAS/NZ2243.3). Such
applications may be processed by way of a rapid assessment path, which is intended to take
just two weeks.
Any person may make a written submission on a publicly notified application. ERMA may
hold a public hearing of the application and is required to do so if the applicant or a submitter
requests to be heard.
In light of this, an applicant should, at a very early stage, identify potentially interested
parties including both potential supporters and opponents and develop a consultation strategy
which is appropriate to the circumstances. The purpose of undertaking consultation is
two-fold. It enables the applicant to understand public perceptions about the proposal and
thereby to attempt to address them outside of the formal process. To the extent that public
concerns are based on a lack of information or a misunderstanding about the technology, its
benefits and risks, this may be able to be addressed through that process in an efficient manner.
The consultation strategy also enables the applicant to identify avenues of support (eg the
potential beneficiaries of the product involved and the applicant's potential customers). Such
parties can be encouraged to lodge a submission in support of the application so as to further
impress the benefits of the proposal upon ERMA.
If any significant areas of public concern do exist these are usually identified through this
process and the applicant is in a better position to address them to the extent required
throughout the formal processing of the application.
On a broader level, industry should continue to be proactive in educating the public about
the social and economic benefits of biotechnology. The Gene Techonology Information Trust
and its operating group Gene Pool, discussed in an article about public perceptions of
biotechnology in the May/June 1998 issue (Muggleston, 1998), exemplifies this approach.
Research indicates that people have a greater tolerance of risk when they understand the
corresponding benefits.
Public Hearings - Keeping Bad Science out of the Process
If a public hearing is necessary in relation to an application, and significant adverse
public reaction has been identified through the consultation process, the applicant then needs
to consider how to address that opposition at the hearing.
The key concern is to ensure that ERMA is appraised of the relative merits of any
competing claims and is making its decision based on evidence which has scientific credibility.
Section7 of HSNO requires ERMA to be cautious when presented with scientific uncertainty
as to the effects involved:
All persons exercising functions, powers and duties under this Act . . . shall take into
account the need for caution in managing adverse effects where there is scientific and technical
uncertainty about those effects.
However the adjective "scientific" implies that mere allegations as to adverse effects are
not sufficient to trigger the need for caution.
The Environment Court in New Zealand (which decides applications for resource consents
under the Resource Management Act 1991 in relation to the use and development of natural
and physical resources) and the civil courts in various jurisdictions have considered a number
of tests proposed to separate reliable from unreliable scientific evidence.
Based on such tests, an applicant should ensure that ERMA is appropriately informed to
assess whether the concerns raised by opponents are based on published scientific material
which has been the subject of peer review, whether the hypotheses or theories involved have
been the subject of repeated testing and verification, and what is the level of acceptance in the
relevant scientific community of the assumptions behind the claims asserted. This should be
compared with the evidence which the applicant relies on in explaining both the potential
adverse effects or risks involved with the technology.
ERMA's decision must be released in writing, including reasons. Any party to an
application for approval and any person who made submissions to ERMA on such an
application may appeal ERMA's decision to the High Court on a question of law. There is no
general right of appeal against a decision on whether to grant or decline approval to a
substance or organism.
Conclusion
The biotechnology industry is set to play an increasingly vital role in the future of
New Zealand's agricultural/horticultural and export-dominated economy. However, there is a
general lack of public understanding about the technologies involved and a significant degree
of public concern which has most acutely been expressed in relation to genetically modified
food. The biotechnology industry has something of a marketing job to do if it is going to enjoy
a level of success under HSNO which is consistent with the considerable level of benefits
which the industry can provide to the New Zealand economy. A strategic approach to
applications under HSNO should ensure that an internationally credible approval is obtained,
and that the benefits of the technology are better understood by the public.
References
Muggleston, S. (1998) Talking about Gene Technology: a New Zealand Perspective
Australasian Biotechnology, 8, 160-163.
Mark Christensen is a partner and Martin Williams is a solicitor at the law firm Russell
McVeagh McKenzie Bartleet & Co, based in Auckland and Wellington, New Zealand,
specialising in environmental and regulatory matters.
Copyright 1998 Australian Biotechnology Association Ltd.
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