Submission to: Inquiry into mechanisms for compensation for economic loss to farmers in Western Australia caused by contamination by genetically modified material

Summary

Consumers around the world avoid GM food and seek organic food. Australia is a global pygmy in the world of genetically modified organisms (GMOs) and a giant in the global world of organics. Western Australia (WA) has a GMO moratorium in place with certain exemptions. GM produce sells at a discount compared to non-GM produce and organic produce. GM crops put non-GM growers and organic growers at risk of contamination and this can lead to economic losses. Non-GM produce contaminated with GM is discounted in the market place as GM produce. Such contamination causes economic harm to non-GM farmers and particularly to organic farmers. In the case of Marsh v Baxter, a WA farmer harmed by GM contamination (to the extent of $85,000) went through the courts (with combined legal costs of approximately $2 million) and the law failed to provide any remedy to the harmed party (Marsh). The simplest fix is to revert to the WA GM moratorium without exemptions. In the absence of that, a compulsory third party (CTP) GMO incident insurance is proposed. CTP works successfully in other areas of potential harm (e.g. motor accidents). CTP is an insurance and hence it deals with risk. CTP decouples the premium-payer (the potential source of harm) of the CTP from the claimant (the potential victim of harm) with an independent arbiter. No fault CTP is recommended.