Bayer of Germany to Share Technology with Russia

The project, in which the Institute holds a key expert position, has been hailed a success.

The Federal Antimonopoly Service of Russia (FAS) approved the merger of the German company Bayer and the American Monsanto. In exchange, the German company agreed to transfer to Russia some of its digital solutions for agriculture and technology in the field of seed selection. This was announced at a briefing at the FAS on Friday, with a transmission sent via the FAS website.

Participants of the briefing: Head of the Federal Antimonopoly Service, Igor Artemyev, and Deputy Head, Andrey Tsyganov. From Bayer: Senior Vice President of Bayer AG, Hartmut van Lengerich and CEO of Bayer in Russia, Bayer's general representative in the CIS Nils Hessmann. Also in the briefing were Provost and Director for Expert-Analytical Work of the Higher School of Economics, Andrey Zhulin, and Director of the Skolkovo-HSE Institute for Law & Development, Alexey Ivanov, who gave direct expert participation in the run up to the decision.

"The colossal acquisition of Monsanto by Bayer in Russia's jurisdiction has been completed, the antitrust authority has given its consent to this deal", said FAS Head, Igor Artemyev. FAS issued to the companies a five-year order on measures aimed at increasing competition in the agri-industrial complex. Over the course of the five years, Bayer must transfer the agreed technologies to Russian agriculture. Artemyev added that the FAS will require two other major companies - the Swiss Syngenta and the American DuPont - for their work in Russia to be under the same terms as Bayer, which agreed to the partial technology transfer to Russia. This has been done to ensure that all companies are on an equal footing, and that competitors in relation to the German concern have not received "unreasonable advantages which in fact should not be present", said the head of the FAS.

At the briefing, the general representative of Bayer AG in Russia and CIS countries, Nils Hessmann, said that the German company agreed to contribute to the creation in Russia of a scientific and training facility for plant biotechnology. The company will train Russian specialists and exchange experience with them in the field of breeding. In addition, Russia, he said, will receive "non-discriminatory access to digital applications and the digital platform on which Monsanto operates". This will happen upon the commercial launch of relevant technologies in Russia.

Bayer will also share some of the technology used in seed selection. According to the FAS, Russia will receive the molecular resources concerning the breeding of corn, rapeseed, wheat, soya, and vegetable crops (tomatoes, cucumbers, and cabbage), as well as the individual germplasm for these crops, except for the vegetable crops. This has been stated in the press release of the German company.

"Receiving this approval is another significant step towards closing the deal. We are glad that we managed to come to an understanding with the FAS", said Hessmann. The Centre for Technology Transfer of the Higher School of Economics National Research University will coordinate the transfer of the technology. The Centre will select the interested recipients of the technology transfer and monitor the implementation of the order.

Bayer agreed to buy Monsanto for $66 billion in 2016. The merger of the two companies should lead to the creation of the world's largest manufacturer of herbicides and genetically-modified seeds. As of now, regulators of the different countries, where both companies are represented, are deciding on the approval of the transaction. Of the 30 jurisdictions, the merger has been approved by two thirds of regulators, including the regulators of Brazil, China, Russia, and CIS countries.

In Russia, the antitrust regulator initially required Bayer to transfer technology to Russian companies in the field of seed selection. These technologies are desirable in order to create new varieties and hybrids that are applicable to the Russian climate. In addition, the FAS demanded the transfer to Russia of digital farming databases. Bayer responded to the FAS in court and warned that they could leave Russia due to the actions of the regulator. But on March 16, the FAS stated that during negotiations with the leadership of the German concern, it has been possible to achieve a mutual understanding.