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Concerns about ecological sustainability and inequality are driving increased formalization of the natural product trade, including both biotrade of bulk, raw materials (or nontimber forest products [NTFPs]) and bioprospecting for genetic resources. However, there has been little interrogation as to whether the policy tools used to achieve sustainability and equity goals are appropriate and effective. This article addresses this gap by examining efforts to formalize biotrade, including the blurred regulatory lines that increasingly exist between biotrade and bioprospecting. Two case studies are explored from southern Africa-baobab and Pelargonium. Findings emphasize the unintended consequences that can arise from overregulation and poorly formulated laws, including the further marginalization of women and/or poor communities; elite capture; weakening small businesses; and leakage across political boundaries. Conclusions underpin the need to pursue solutions that are better informed and more respectful of local knowledge and needs, and that draw upon both customary and statutory laws and institutions.