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Abstract
In this article, legal consequences of the new German genetic engineering
act are analyzed. In addition environmental economic
analysis is presented of those parts of the act that introduce new
litigation regulation to farmers. The different kinds of external costs
arising from genetic engineering of plants and their allocation to
different actors are considered. The paper focuses on the costs
resulting from the postulated coexistence of conventional/organic
farms and users of biotechnology. Excessive liability of farmers can
be avoided, if the producers of genetically modified seeds accept
any litigation claims against farmers. Furthermore, negotiations
between neighbouring farms can be an option to keep the costs of
damage prevention at reasonable levels.