TWN Info Service on Sustainable Agriculture
29 October 2026
Third World Network

Cali Fund: Developing Countries Reject Unequal Incentives and Unlawful DSI Publication

Yerevan, 28 October 2026 (Nithin Ramakrishnan) - Developing countries are pushing back against attempts to shift the burden of incentivizing users of digital sequence information (DSI) to contribute to the Cali Fund onto provider countries. This despite Decision 16/2 of the Convention on Biological Diversity (CBD) calling for measures by countries hosting those users.

They also reject the presumption that DSI derived from their genetic resources can be published under the pretext of “open access” without the permission of the providers of those resources. They also boldly stated that such open access cannot be treated as non-monetary benefit-sharing within the scope of the Multilateral Mechanism.

The 17th meeting of the Conference of the Parties (COP17) to the CBD is taking place in Yerevan, Armenia, from 19 to 30 October 2026. It is considering agenda item 11 on DSI on genetic resources and the Multilateral Mechanism for the fair and equitable sharing of benefits arising from its use.

The negotiations follow COP Decision 16/2 adopted in Cali, which adopted the initial modalities of the Multilateral Mechanism, including the Cali Fund. A draft decision partly prepared by the Secretariat and partly produced by the Subsidiary Body of Implementation is under consideration. Among other matters, it addresses incentives and certificates for DSI users and the governance of publicly available DSI.

Parties, as well as stakeholders, made several textual proposals during the first Working Group meeting via early written statements and oral statements during the plenary. Later on, the item was split into two tracks, with a Contact Group negotiating most parts of the draft decision, while a closed Friends of the Chair meeting was set up to discuss governance matters involving the work of the Steering Committee of the Multilateral Mechanism and the memorandum of understanding (MOU) that administratively set up the Cali Fund, between the CBD Secretariat, UNEP, UNDP and the United Nations Multi-Partner Trust Fund Office.

The draft decision circulated before the session is divided into nine sections

                           I.  Potential additional modalities of the Mechanism

                         II. Cali Fund thresholds and contribution rates

                      III. Steering Committee of the Multilateral Mechanism, including the Cali Fund

                       IV. Certificate

                         V. Allocation methodology

                      VI. Matters related to the governance of the Mechanism

                   VII. Review methodology

                VIII. Support for the operationalization of the Mechanism

                      IX. Data availability and accessibility

Developing countries have challenged proposals concerning certificates and data availability, arguing that they could shift responsibilities away from user countries and leave important questions about the lawful publication and use of DSI unresolved.

Certificates: Unequal incentives transferring obligations to developing countries

Developed countries and industry stakeholders have emphasized recognition by Parties of certificates issued by the Cali Fund to users who make monetary contributions. Such recognition could exempt users from further monetary benefit-sharing claims within the scope of the Multilateral Mechanism for the relevant year. This, they argue, is the most important incentive to be given to the DSI users, as Decision 16/2 urges Parties to take measures that incentivize such users to contribute to the Cali Fund.

Paragraph 16 of Section IV of the draft decision originally circulated recognizes certificates as a measure of encouragement, not as an incentive which has a specific meaning within the Decision 16/2. However, Paragraph 16 of Section IV of the draft decision in the non-paper developed by the Co-Chairs of the Contract Group modified this text and proposed to recognize certificates as incentives. The text in the non-paper reads thus: Recognizes that Cali Fund certificates, as applied to the digital sequence information in the scope of the Multilateral Mechanism, are important means to incentivise users to contribute to the global fund in line with the modalities of the Multilateral Mechanism, including the Cali Fund.

Japan and Switzerland, in their written submission to the Working Group, indicated that only Parties recognizing the certificates of the Cali Fund will be entitled to receive from the Cali Fund.

This proposal later appeared as Para 18 ter in the non-paper version of the draft decision prepared by the Contact Group Co-Chairs: “18 ter. Decides that the recognition of the certificates and exemption from further benefit sharing claims referred to in paragraph 18 is required for Parties to receive funds from the Cali Fund.”

Meanwhile, industry representatives argued at side events of the COP17, that Cali Fund certificates should not merely exempt users from further monetary benefit-sharing obligations under the multilateral mechanism, but should also extinguish all other obligations under national access and benefit-sharing (ABS) laws. This would effectively expand the certificate's function beyond the Multilateral Mechanism as decided at COP16 and risks turning certificates into a broader licence to operate.

Developing countries challenged this approach, emphasizing that the responsibility to incentivize contributions must primarily rest with countries hosting DSI users, as envisaged in Decision 16/2. They distinguished the role of provider countries in recognizing certificates to provide legal certainty, from the responsibility of user countries to adopt measures that incentivize contributions, envisaged under paragraph 13 of Decision 16/2, which calls for measures by user countries.

[Para 13 of Decision 16/2 reads: Parties and non-Parties are invited to take administrative, policy or legislative measures, consistent with national legislation, to incentivize users in their jurisdiction to contribute to the global fund in line with the modalities of the multilateral mechanism.]

For developing countries, recognition of certificates and incentives for users are therefore distinct issues. Recognition may clarify the extent of a user's monetary benefit-sharing obligations under the Multilateral Mechanism, but it is not a substitute for measures by user countries to encourage contributions. (To understand the concerns substantively, see: https://www.cbd-alliance.org/en/2026/cali-fund-certificates-unbalanced-and-ineffective-incentive)

Some of the developing countries further argued that certificates and exemptions have a value only if it comes from a provider country of DSI, which has national ABS laws seeking monetary benefits from the use of DSI.  Most developed countries do not have national ABS laws that obligates DSI users to share benefits. This creates an unequal burden on the developing countries with national ABS laws on DSI to make the Cali Fund work.

Developing countries consequently questioned the use of the term “incentivize” in relation to certificate recognition, with several proposing “encourage” instead. Others called for an explicit reference to paragraph 13 of Decision 16/2 to distinguish certificate recognition as a measure supporting legal certainty, from incentives that user countries are expected to provide.

A few developing countries showed flexibility towards recognizing certificates as one of the many possible incentives, but they, along with most other developing countries, cautioned against transferring the responsibilities of user countries (mostly developed countries) to provider countries with national ABS laws on DSI (mostly developing countries).

Some countries very clearly objected to the larger agenda of the industry, by saying a certificate is only a certificate of contribution, and not a certificate of compliance.

Further during the Contact Group, the proposal that limits access to funds to Parties that recognize certificates, i.e paragraph 18 ter of the non-paper, was withdrawn owing to a counter proposal from the developing countries. This counter proposal asserted that only DSI users coming from Parties taking measures to ensure that DSI users from their jurisdiction contribute to the Cali Fund would be entitled to obtain an exemption based on the certificates.

Open access to DSI is not non-monetary benefit sharing

Developing countries also challenged proposals to recognize open access to DSI as a form of non-monetary benefit-sharing under the Multilateral Mechanism.

Open access to DSI can facilitate research and development. However, making DSI publicly available or open access, is not, by itself, equivalent to sharing benefits arising from the use of DSI under the Multilateral Mechanism.

The distinction matters because the Mechanism concerns benefits arising from the use of DSI, rather than the broader benefits that may arise from the utilization of physical genetic resources. The latter may be addressed through national ABS frameworks and mutually agreed terms between providers and users.

In its written submission, the Japan Biodiversity Association argued that “Registration of DSI in public databases, such as the International Nucleotide Sequence Database Collaboration (INSDC), constitutes the most fundamental form of non-monetary benefit-sharing.”

The DSI Scientific Network similarly proposed including “access to research results, including publicly available digital sequence information on genetic resources” among the non-monetary benefits that could be shared.

These proposals appeared in paragraph 13 alt bis (a), under Section III of the second version of the Contact Group Co-Chairs' non-paper. Most developing countries rejected the proposal.

One Party argued that its material transfer agreements for sharing physical genetic resources already treat publication of the resulting DSI as a non-monetary benefit, and called for public availability of DSI to be recognized as a benefit in itself. However, this argument concerns benefit-sharing arising from the use of genetic materials under arrangements such as material transfer agreements. It does not necessarily establish that public availability constitutes a benefit arising from the use of DSI within the scope of Decision 16/2.

A civil society organization further noted that the non-monetary benefits arising from the use of genetic resources are subject to the national policies of individual Parties and should not be standardized through the Multilateral Mechanism. It also highlighted the absence of a commonly accepted definition of “open access” and cautioned that some communities and resource providers may not wish to make DSI derived from their resources publicly available without conditions. Making such DSI publicly available is unlawful and inconsistent with the rights recognized under the CBD.

Developing country Parties also resisted the proposals stating that access to DSI databases would also be considered as non-monetary benefit sharing. Many developed countries argue that they sponsor these databases and therefore they are already sharing non-monetary benefits. Developing countries not only objected to this argument, but also objected to the manner in which existing DSI databases are operating without verifiable metadata for legal and geographic provenance, as well as without user registrations and verified user accounts.

Taking into account the non-binding nature of Decision 16/2 on DSI databases, a megadiverse developing country proposed specific text suggestions to amend the proposed paragraph 37(b) of the draft decision.

The proposal was not captured in the on-screen text during the Contact Group. On request, the Brazilian delegation shared the text proposal with the Third World Network, and it reads the following:

37(b) Parties and other Governments funding, sponsoring or hosting sequence databases as well as organizations hosting databases that make digital sequence information on genetic resources publicly available to share information on the actions that they have taken to make sure that entities operating such databases, [ADD particularly through standardized, interoperable, and persistent metadata on provenance, country of origin, associated traditional knowledge, and prior informed consent, as well as user registration through verified individual accounts], progressively implement, practical and proportionate measures to improve transparency, accountability, and accessibility [ADD for indigenous people[s] and local communities], providers and users of digital sequence information on genetic resources in such databases, [ADD including through the progressive integration and application of the CARE Principles for Indigenous Data Governance,] and while maintaining open access and taking into account existing database practices, in accordance with paragraphs 10, 11 and 12 of the annex to decision 16/2;

Calls for greater accountability and new database infrastructure

Previously during the Plenary, Egypt, on behalf of the African Group, had also stated that on data governance, they support “advancing a CBD-governed database, platform or equivalent infrastructure to strengthen transparency, provenance, accountability and the functioning of the mechanism. Its feasibility should be assessed alongside other models, without predetermining reliance on existing external databases, while ensuring scientific openness, interoperability, responsible data sharing and respect for national legislation. Parties funding, sponsoring or hosting databases also have responsibilities in this regard.”

Similarly South Africa, on behalf of the Like-Minded Megadiverse Countries (LMMC) also stated in the Plenary that “Databases should accurately record the country of origin, information on legal access to the genetic resources from which DSI is derived, where applicable and as appropriate, and be transparent about use while remaining open for research. We support a feasibility assessment of options, including a platform under the authority of the Conference, before COP18.”

Negotiations move towards a possible President's text

The negotiations at COP17 have been very complex and have progressed through multiple tracks. As indicated above, a Friends of Chair group was established to discuss the work of the Steering Committee, its reconstitution, as well as issues relating to the scrutiny and amendment of the MoU that established the Cali Fund administratively at the United Nations Multi-Partner Trust Fund Office. All other issues first moved to a Contact Group established under Working Group 1.

Subsequently, Contact Group discussions were divided among three smaller groups dealing with certificates and allocation methodology, review methodology for the Multilateral Mechanism, and data availability and accessibility.

The Friends of the Chair group and the three smaller groups conducted closed-door negotiations. According to several sources, limited textual negotiations took place in these groups, raising suspicions that a new text could emerge from the COP17 Presidency towards the end of the second week of COP17.

Some developing country negotiators also expressed concern that the division of agenda items into smaller groups made it difficult for delegations to follow all discussions, particularly as other COP17 agenda items were also being handled in parallel, in a similar manner. One developing country negotiator informed the Third World Network that their delegation had reserved the right to reopen text in the plenary if its inputs were not adequately reflected in proposals emerging from smaller groups in which it had not participated.

As negotiations continue, the central questions remain whether the Cali Fund will be accompanied by meaningful incentives from countries hosting DSI users, and whether the Multilateral Mechanism will address the accountability and transparency gaps surrounding DSI access and use. For developing countries, these issues are integral to ensuring that the mechanism delivers fair and equitable benefit-sharing, rather than simply focussing on end-of-value chain financial contributions while leaving the underlying governance questions unresolved.

Presidency calls informal Ministerial Consultations, which may prejudice future work

Early in the morning of 28th October, the Presidency sent out a letter, inviting  Ministers and Heads of Delegation to an informal Ministerial consultation on this agenda item, on Wednesday, 28 October, from 15:00 to 16:30. The Consultation will provide an opportunity to offer political guidance on the remaining issues and help identify a balanced and broadly acceptable way forward.

Her Excellency Evelyn Ndlovu, Minister of Environment Climate & Wildlife of the Republic of Zimbabwe, and Her Excellency Sigrun Gjerløw Aasland, Minister of Climate and Environment of the Kingdom of Norway will be supporting the Presidency in conducting these consultations.

The letter raises the following questions as subject matters for discussion:

1) Overarching question: Should the Mechanism and Cali Fund start its operations now with a review at the next COP? Or hold off until the modalities are more refined to start operationalizing?

i. Incentivization:

1. “Money – in” - Calculation of contributions for companies - Should companies calculate their Cali Fund contributions based on their total revenue/benefit, or have a choice to calculate only for the part of their products which use DSI?

2. “Money – in” - Cali Fund Certificates – should the Steering Committee start issuing certificates as soon as they are ready on an interim basis, or wait for the COP to review its work before the Cali Fund Certificates are given to contributors?

3. “Money – out” - Allocation methodology – should the work of the experts on the allocation formula be applied now for disbursements to governments and indigenous peoples and local communities? Or hold off on the possibility to disburse until the methodology is more refined at COP18?

ii. Review of the Mechanism: the Mechanism will be reviewed at COP18 (COP16 mandate). Should the Parties decide to implement the methodology presented by the Steering Committee for the first review?

2) Overarching question: Improving the alignment of the Memorandum of Understanding with benefit-sharing and the principles of the Multilateral Mechanism and the Cali Fund. Should the Steering Committee be requested to do these improvements and the new MOU signed as soon as it is ready? Or should a legal process be led by the COP and reviewed at COP18 for a signature in two years?

These questions, on the face of it, may prejudice developing country positions and future processes that were discussed in the COP17 Contact Group.

First, on the question on calculation of contributions for companies, the question is raised as to whether the companies have a choice to calculate contributions on the basis of revenue generated by their products that use DSI. This departs from the understanding of Decision 16/2 which says that contributions will be based on the companies’ total revenue and/or profits.

The discussion at COP17 so far has been about establishing a process to consider developing additional pathways that may take into account the use of DSI in final products and services, but through an intersessional process leading to COP18. The question was never about giving a choice to companies. Further, the question does not take into account the industry stakeholders' pressure that there should not be tracking and tracing of the use of DSI, which led to the compromise of the revenue/profit based calculation in COP16.

Second, the idea that “certificates are incentives” are entrenched in the structure of the questions itself and this is directly in contravention to the arguments made by developing countries. As clearly determined in Decision 16/2, the certificates are not incentives to be given by the user countries. However, the Presidency’s letter identifies certificates within the overarching section on incentivization.

Third, the question on review methodology does not take into account divergences existing on the methodology, including on the assumptions with which the methodology was developed. These assumptions are criticized for not being consistent with Decision 16/2. Moreover, there was no discussion on the review methodology at COP17.

Finally, the questions regarding whether the Steering Committee should issue certificates and sign the MOU before COP18 finalizes them is a pertinent question, however, the developing countries have clearly expressed their priorities that COP should have the final say on these matters, given their experience with the implementation of the Cali Fund related activities over the past two years. +