Last updated: 24/10/2014

What is the Third Party Beneficiary?

 Facilitated access and benefit-sharing under the Multilateral System are provided pursuant to the Standard Material Transfer Agreement (SMTA) which contains contractual terms and conditions applicable to providers and recipients of material. By concluding an SMTA, individual providers and recipients become bound to those contractual terms and conditions.

The Third Party Beneficiary is an entity designated by the Governing Body of the International Treaty and which acts on behalf of the Governing Body itself and the Multilateral System to ensure observance of the contractual terms and conditions of the SMTA by the individual providers and recipients.

What are the role and functions of the Third Party Beneficiary?

The role and functions of the Third Party Beneficiary are set forth in the SMTA and thus accepted by the individual providers and recipients that are bound to the agreement. In accordance with the SMTA, the Third Party Beneficiary is conferred the following rights:

• the right to request information to parties to the SMTA, as required by various provisions of the agreement;
• the right to initiate dispute settlement procedures regarding rights and obligations of the parties to the SMTA;
• in the context of dispute settlement, the right to request that the appropriate information, including samples as necessary, be made available by parties to the SMTA, regarding their obligations.

FAO acting as Third Party Beneficiary and the Third Party Beneficiary Proceduresp

Upon invitation of the Governing Body of the International Treaty, the Food and Agriculture Organization of the United Nations has accepted to act as Third Party Beneficiary.

The Governing Body has established procedures for FAO to perform the role and functions of Third Party Beneficiary.

The Procedures define the role and functions of FAO in cases of non-compliance with the obligations of the SMTA through a system of progressive escalation, which consists of:

(i) the initial gathering of information with regard to a dispute;
(ii) amicable dispute settlement;
(iii) mediation; and
(iv) arbitration.
 
 

Information gathering is an informal action, which allows FAO to become aware of a possible case of non-compliance. FAO may receive and use information on cases of non compliance from the parties to the SMTA or any other person. Where FAO has received such information, it may request additional information from the parties to the SMTA.

If the information so gathered leads FAO to believe that a possible case of non-compliance might have occurred, FAO may trigger amicable negotiations through an initial notice to the parties to the SMTA.

If the dispute cannot be resolved by negotiation, FAO shall commence or encourage the parties to the SMTA to commence mediation proceedings. FAO shall propose to the parties in dispute that mediation be carried out through a set of Mediation Rules that were approved by the Governing Body of the International Treaty and are administered by the WIPO Arbitration and Mediation Center.

Request for mediation

If the dispute has not been resolved by mediation within six months of the commencement of the mediation or if it otherwise appears that the dispute cannot be resolved within twelve months after the issuance of initial notice, FAO may submit the dispute to binding arbitration.

The list of mediation and arbitration experts is available online as well as the information on the nominations of experts.

Contact details:

Food and Agriculture Organization of the United Nations
Viale delle Terme di Caracalla, 00153, Rome, Italy
Tel: +39 0657053554
Fax: +39 0657053057
TPB-Treaty@fao.org