European Union’s Geographical Indications Regime

Acknowledgements

Executive Summary

Broader protection to agricultural and other commodities would be made available to the individual countries on the basis of specialization in the location and quality of the respective goods, if the proposal from European Union is adopted by the World Trade Organisation (WTO), for the protection of the Geographical Indications of the products. Geographical Indications denote the recognition of the products to be identified on the basis of their origin from a particular place or location having traditional or other special attributes associated with the product.  The proposal for protection for GIs was initially established in the Uruguay round of the General Agreement on Tariffs and Trade that are now within the jurisdiction of the WTO. The Trade-Related Aspects of Intellectual Property Rights (TRIPS) Agreement provides for the further progress on the negotiations of issues in relation to the protection of GIs. The Doha Round negotiations on the auspices of TIRPS Agreement witnessed the different approaches of the WTO member countries on the issues of GI. While EU submitted its proposal to further strengthen the position of GI by extending to more commodities, countries like United States, Australia, Canada and other major food exporting countries vehemently opposed the proposal of EU as a deterrent against competition. The issue remained to be looked into by the Dispute Settlement Body of the WTO for further progress in the matter of GI and its extension. With this background this paper presents a detailed report on the GIs in general and the stand taken by EU in respect of the protection of GIs and its compatibility with the TRIPS Agreement.

Introduction

With the advent of economic globalization the geographical dispersion of the business and industrial houses has broken all the barriers and made them establish their manufacturing and trading facilities wherever there is economy of scale and cheap labour is available. This has made the interdependence of the countries on each other expand to a large extent. In this context, then it becomes important that the countries assess the distinctions between each of them to gain the economic advantages of their own products and services in the world market. The identification of the differences is also necessary from the point of view of each country to attain prominence in respect of the products or services it supplies and to assert its position in relation to its customers. Because of this unique purpose counties often declare themselves as self sufficient and would never admit of deriving benefits from other nations. Examples in the history may be found in China and Russia. In China in the previous decades, because of their closed door policy, the country never allowed the products of other companies being sold in their country. Similarly olden Russia wanted to build their country on their own resources but failed to meet the objective of socialism due to the several reasons including not meeting certain preconditions that have been predicted for the socialism to thrive among other things.(1)

But it must be observed with the changing commercial scenario and with the technological advancement in the information and communication technology the countries have come closer and with the increasing commercial ties between the countries it has now become possible to exchange anything and everything one country can produce with the other. Gone are the era of protectionism and licenses. However this expansion in the commercial activities has also given rise the need for the individual countries to protect their products and their rights on producing them within their own country. The evolution of registration of patent rights will illustrate this point. When analysed further one may also note that, the marking of geographical indication is one of the protection mechanism undertaken by the different countries especially the Europeans ones. Protection of Intellectual Property Rights is another step in this direction. All these are required to ensure that the countries do not lose their legal right of claim on the production and marketing of the specified products peculiar to their countries.

Such protection of the interests on the products is often commonly found in all European Countries as these countries are very particular and strict in protecting their products.

Such vigilance on the part of the European countries has led to the promulgation of policies on geographical indications of the products with a view to avoid the product piracy in the market. The Geographical Indication commonly denoted as ‘GI” is issued with a view to protect their products the countries. A geographical indication usually is reflected sign that is made on the goods to indicate that the goods are of the origin from a specific country or geographical location. The use of geographical indication also certifies that a certain product has a unique quality and sound reputation based on its geographical origin.

Though the forming of the European Union is characterized by the need for adopting common policies of trade and commerce, currency and monetary systems, common customs laws and free movement of merchandise within the EU, still the differences between the various EU countries exist in preserving the origin of their products evidenced by the ‘feta wars’.

With this background this paper outlines the features of the geographical indications, the economic importance of the geographical indications, impact of the GI on the economy of the different GI member countries and the clauses of GATT/TRIPS to the extent they have a bearing on the geographical indication.

Geographical Indications:

The geographical indication also indicates that the goods of a specific origin possess qualities or reputation very peculiar and special to that particular country or place of origin. The name of the city or other place of origin is the most popular form of geographical indication. Normally agricultural products adopt more of geographical indication by the name of the place in which they are being produced often influenced by the climatic conditions or soil conditions prevailing in the respective places. The fit examples are ‘Tuscany’ olive products from Italy and ‘Roquefort’ cheese products from France. These products got their identities fixed with the names based on their respective geographical locations in the countries.

Definition of Geographical Indications:

Though there exist a number of definitions of geographical indication, the simplest definition for geographical indication is provided by Botha (2004)[1] as “a designation which identifies certain qualities or other characteristics or the reputation of a particular product to a specific geographical locality”

As indicated the Geographical Indications (GI) of goods are defined as “that aspect of industrial property which refer to the geographical indication referring to a country or to a place situated therein as being the country or place of origin of that product. Typically, such a name conveys an assurance of quality and distinctiveness which is essentially attributable to the fact of its origin in that defined geographical locality, region or country”[2] GI are also covered under Articles 1 (2) and 10 of the Paris Convention for the protection of Industrial Property as distinctive parts of IPRs. Articles 22 to 24 of the Trade Related Aspects of Intellectual Property Rights (TRIPS) also protect the GI of different products for the countries that have participated in the Uruguay Round of the GATT negotiations.

GI also encompasses an appellation of origin. Appellation of origin is a special kind of GI normally used on products that is distinguished by a special quality or character made distinct by the ‘geographical environment’ in which the products are originating.

The terms ‘appellation of origin’ and ‘geographical indication’ are being often used interchangeably and such interchanging of the use results in confusion.  “Sometimes, designation of origin is called appellations of origin while the geographical indication is called indications of provenance and there are a lot of terms that were created by different legislations. The general term, indications of geographical origin also means designations of origin and the indications of origin”.[3]

Article 22 of the Agreement on Trade Related Aspects of Intellectual Property Rights (TRIPS) defines GI as “Geographical indications, for the purpose of this Agreement, are identifying a good as originating in the territory, where given quality, reputation and other characteristics of the good are essentially attributable to its geographical origin.”[4]

On the basis of this definition it can be inferred that the TRIPS agreement essentially provides three different factors on which a given product can be protected, namely; quality, reputation or other special features that characterizes the product as belonging to the location or origin. Hence it becomes important that the product is attributed with the qualities and reputation form the particular location. It must also be noted that there exist a nexus between the products and their places of origin.

Different Elements of the Definition of Geographical Indication:

Document SCT/9/4[5] analyses the definition of the ‘geographical indication’ as provided by Article 22 of the TRIPS Agreement on the basis of the questionnaire produced by WTO[6].  The different elements of the definition of the term ‘geographical indication’ are taken to mean different things based on the perspectives of different countries and the systems and procedures being followed in those countries. It is necessary for the products to be protected prove that they possess the required qualities mentioned within the specification of the products and also they include all the elements of the definition of the GI. The products should also be capable of be producing specific proofs to the effect that they possess such characters.  The different elements of the definitions are:

‘Originating in the Territory, a region or a locality in that territory’

“The description of the geographical area chosen for the request for protection as a geographical indication should generally be made in the most possibly precise terms”[7] The existing political and administrative divisions define the delimitation of the geographical areas pertaining to the products. It is necessary to prove that the geographical area concerned is situated in a region, sub-region, zone, district and so on. The origins of raw materials, various stages of manufacturing, packing can be listed for the information of the consumers for easy identification of the products.

‘Quality’

It is possible to establish the quality of the product by detailing the precise description of the product or the ways of obtaining it. But it is necessary that the description provided by the application for GI for the particular products should be precise and complete in all respects in order that such application is considered for the grant of the protection under the regulations. “The description of the product may/should include the raw material, the main physical (Q2 value[8], pH, shape, weight, appearance, consistency), chemical (presence/absence of additives, residues and so on), microbiological (use of such and such ferments, presence of germs) and/or organoleptic (smell, taste, texture, color, visual and sensory … profile) characteristics of the product “[9] The actual state in which the product is offered for the ultimate customer like fresh, frozen or preserved may also form part of the description.

It is a precondition that the description should be able to identify the personal characteristics of the product. The methods for obtaining the product, quality criteria of the final product, description of the techniques implemented can all be the constituents of the description of the products for the purposes of GI. In the case of manufactured products the descriptions relating to the raw materials like type of products or parts of the product and descriptions relating to manufacturing process covering preparation, drying or slating can be considered to be the parts of the description of the products concerned. It is vitally important that the description of the products that describes the qualities of the products highlight the explanation as to how the location of the products gives rise to the special qualities of the products. The description about the qualities should also explain the bearing the location has on the special characteristics of the products.

‘Reputation’

The history and historical origin of the products has a close nexus to the ‘reputation’ of the products. Hence it becomes necessary that the description of the product should cover a detailed account of the history which should be capable of demonstrating the historical existence with respect to the geographical area and also the reputation attached to the product because of the historical origin. Reputation always signifies the capability of the product in distinguishing itself from other products by the special characters it possesses. “The stronger a product’s identity, the more it will be able to display its established reputation, which should prove that the product is recognized as distinct in a family of products and that it therefore has specific features”.(WIPO Working Paper) This requirement is based on the premise that the distinguishing features have made the product special from a certain point of time an up to the point of making the application to bear the name as described more by the GI. The name has given the ability to the product to represent is sales designation and also acquire a special identity which has given the product its established reputation.  Reputation often is based on the perception of the consumer about the GI. This tells upon the ability of the consumer to differentiate the protected product as GI form similar products. The investments made by the producers may also be considered as an economic value of the reputation, in as much as the reputation is dependent on the investments. Similarly the assessment of the reputation always differs in perspective based on the systems and the products. The assessment can take the form of a local, national or international reputation.

‘Other Characteristics’

“The link between the product and its geographical origin can also be established in terms of characteristics other than quality and reputation.  Among the most frequently used are, inter alia, human and natural factors (terroir), which are used either in isolation under this heading, or repeated from the previous headings.  These factors are more commonly used in the systems protecting registered geographical indications and appellations of origin”[10]

In any process of approval of a geographical indication, it is necessary that a proper link is made between the product and its special characteristics on one hand and the description of the GI on the other. Therefore it also becomes important and necessary that a proper explanation is accorded as to how the quality, reputation and other special characteristics are linked to the geographical area “and thus to determine the delimitation criteria and the specifications of the product resulting there from.”

Objectives of Geographical Indications:

The main objectives of the GI can be construed as a means for achieving a multiple of policy objectives that are closely associated with the economic development of any nation[11]. These multiple objectives include:

The history of GI can be traced back to the end of the nineteenth century when countries had been protecting mainly the food products by using ‘trademarks’ and ‘trade names’. The governments used to introduce laws in relation to the protection of such goods against false trade descriptions of goods produced in some other location being passed off as possessing a quality or character of another region or location. Under such circumstances the protection of the consumer interest is given priority than the freedom in competition.

In many of the countries the GI law had been used to protect the goods just as is being done in the case of trademarks. Specific prohibitory clauses have been included in such laws to prevent the use of the GI in respect of goods not possessing the special qualities pertaining to the location concerned. Similarly trademarks resembling the GI are not allowed to be registered as such.

The history of the GI in Europe is again associated with certain food products. ‘The Protected Designation of Origin System was introduced in the year 1992 is concerned with the governing of In France the area of GI is taken care of by a system known as ‘appellation d’origine contrôlée’ (AOC) from the start of the twentieth century. In the case of goods meeting certain geographical origin and quality standards, the goods are authroised with a stamp issued by the government. This stamping acts as an official certification of the orgiing and quality of the goods on which the customer can rely upon. This process is also known as appellation of origin. Europe and countries throughout the World followed the model of France’s GI law that was indicated as the best fit model of ‘Registration Rights’[13]. Examples of these kinds of appellations include ‘Tequila’, a kind of spirit, ‘Jaffa’ a variety of orange and ‘Bordeaux’ the renowned red wine.

Functions of Geographical Indications:

Function wise the GI can be considered as serving the identical functions as those of he Trademark. The main functions of GI can be identified as identifying the sources of products, guaranteeing the quality of the products and creation of valuable business interests. Apart from these the protection of domestic and foreign goods has been identified to be other function of the GI. As regards the quality of the products are concerned, Geographical Indications acts as a proof of the product’s quality and thereby enhances the reputation of the product, apart from protecting the interests of producers and consumers against false and baseless information about the quality claims. Besides the function of quality and origin, indications of geographical origin have an advertising function as well. Namely, they provide the producers with an additional distinctive sign for the distinction of their products from other similar ones and their commercial promotion in the market and to compete with multinational companies, which have the means to support expensive advertising campaigns.[14]

The scope of the functions of the GI extends to the protection of the interests of the consumers. The GI guides the customer by indicating the quality and origin of the goods to make a right choice about the products they want to buy.

Geographical Indication as Information for the Consumers:

The main function of the GI can be taken as the provision of information to the consumers on the geographical location of the products and there by enabling the consumer to be informed about the quality, taste or other special characteristics of the products that can be identified  with that particular location.[15] Thus it follows that if there is no correlation between the geographical location and the quality of the goods, the GI would be of no meaning to the customer. There will not arise any need for the local laws to protect such goods until the customer by repeated use of the products learn about the fatuity of the indications. Hence it becomes necessary to have appropriate public policies to distinguish between the GIs that have some meaning to be presented to the customers and those that don’t have. The GIs that do not convey any information or meaning to the consumers should not be considered for the registration and the resultant protection to the products.

“At least conceptually, it should be possible to define the appropriate level of protection for consumers against fraud, misinformation, information asymmetries and high search costs. It follows that if protection is given in cases where the consumer benefit does not exceed the costs of providing the information then the GI is protectionist”[16]

“A recent study seeks to address the issues of optimal provision of information to improve customer decisions in the case of EU’s GI Polciy” (Zago and Pick, 2004)[17]

GI as a Protection to the Producer:

The other use of the GI is to serve as a protection to the producer of the goods which are originating from a particular geographical location and possess some extraordinary qualities by virtue of originating from such locations. The protection is in the form of a registration that ensures the prevention of the misuse of the geographical name by any other produce from the same country or from any other country who advertises or otherwise promotes his products as being originated from the particular location and also possess the qualities peculiar to the location, while in reality his goods do not meet any quality standards the product from the region supposed to possess. Thus it encourages healthy competition among the producers of the same goods from different geographical regions; some possess some distinctive characters and some other possess other qualities depending on the region from which the product originates.

Especially in the case of agricultural commodities the product differentiation necessitated by the GI coverts the docile farmers into active market participants well informed about the change in the consumer needs and preferences and also make them prepared to meet such changed needs swiftly and efficiently. The provision of protection in the form of registration of GI also helps the traders and farmers to improve their ties with other links in the supply chain as well as the vale chain. It improves the relationships with the processors, the retailers and wholesalers of the goods they produce.

Economic Importance Geographical Indications:

For any economy, whether developed or developing, the development of agricultural sector forms the basis for the further advancement of the economy. While predominantly the wine-growing industries of southern France find the use of GI economically more beneficial, the interests in the commercial use of GI by other groups of products has also gained momentum. Thus patent protection in the case of specialised agricultural commodities ensures a rapid development of any economy, especially the developing ones. As observed by N.K. Rokas[18] the geographical indications have two important economic functions:

In fact these basic functions of GI constitute the economic importance for any nation.

Thus it can be stated that the basic economic function of GI lies in the protection of the goodwill of any products and thereby increasing the marketability of the product in the highly competitive international markets. The protection of the goodwill of the products also assumes importance in the protection of the unauthorized exploitation of the goodwill of the products. Perhaps this is the reason that ‘counterfeiting’ and the protection thereof is elaborately dealt with by the TRIPS agreement.

The most important economic importance of GI can be found in its determination of ‘market identity’ for different products. “By the virtue of their basic function of distinguishing goods or services of one enterprise from same or similar goods or services of other enterprises, trademarks are the main building block of what is termed as market identity”[19]   The term market identity implies that the contribution of the products based on a highly valuable innovation to the economy of a nation is very essential with its value addition capabilities in the international market.

Moreover in the production-trading-consumption chain of the products the protection of the geographical indications of the products at each point of activity is very critical for a any economy to grow and sustain its growth as well.

The economic importance of the GI can be assessed form the fact that “85% of French wine exports use GIs. 80% of EU exported spirits use GIs. GIs are the lifeline for 138000 farms in France and 300000 Italian employees.”[20] .It is also interesting to note that out of a 1999 consumer survey it had been observed that 40 percent of the consumers are ready to pay a 10 percent premium for the products which carry a guarantee for the place of their origin.

Approaches towards Geographical Indications in the European Union:

CARD[21] observes that “the European Union has invested a great deal of political and economic capital in promoting the use of GIs to encourage producers to abandon commodity production in favor of producing high-quality, high-value agricultural products associated with geographical location.” The issue of GI and the consequent protection to several agricultural and other commodities have taken seriously by the EU because of the fact the GI is bound to bring lot of new opportunities for the people producing specialized products out of specific regions and the EU would like to provide a comprehensive framework for the protection of such people’s interest by protecting their products.

The GI occupy a prominent role in the economies of all the member nations of the European Union. Though the GIs have been found in all groups of products, they constitute the main pillar of the EU countries’ quality orientation in respect of the agricultural commodities. A major portion of the export of agricultural commodities from EU comprised of GI products. But in the point of view of EU the other important function of the GI is the creation of a ‘genuine niche’ for the promotion of agri-based food industries. This is especially important for those economies where the development of agricultural products is comparatively low. The registration of close to 4800 geographical indications; 4200 wines and 600 other products illustrate the importance of GI in the context of the overall economic development of the EU promoting the exports of 5.4 billion euro of EU exports for spirits, 3.5 billion euro pertain to GI-labelled spirits.[23]

The basic objectives of the adoption of the GI for the EU are:

Promotion of multilateral registration for the GI though which a simple and cost effective system of registration of the GI can be ensured on an international basis, whereby the interests of the farmers and small and medium industries can be protected.
Extension of additional protection of the GI to more number of products other than wine and spirits. The products may range from rice, cheese, tea and the like so that the producers of such products can also enjoy the security of not being copied by producers from other countries.
Gaining market access for the EU GI products by requesting the WTO members to remove the prior registration of trademarks if any and also to grant protection to the EU products even in respect of products that were previously not covered by GI.
In the recent periods the farmers in Europe vehemently facvour the protection of geographical indications, be considered as an integral part of the Doha Development Round of WTO negotiations. Paul Vandoren (2004)[24] observes “with the successive reforms of the EU’s Common Agricultural Policy, EU farmers are moving away from commodities to concentrate on product areas where they enjoy comparative advantages.”

Geographical Indications on Member States:

One of the major obstacles that countries in general are facing with respect to the international protection of geographical indications has always been the varied concepts that are being followed in respect of the GI across different nations. GI has been the subject matter of various legislative measures taken by the countries governing issues like unfair competitive practices, registration and protection of trademarks, laws relating to advertising and product labeling, issues concerning food and health and provisions of any special regulations suited to particular products or issues. With a view to secure the interests of the products as well as the people, countries have been framing laws and regulations that can not fit in to any standards applicable to all countries world over. The different approaches being followed by these countries can not be compiled to make one model that can be followed uniformly by all the countries. However in almost all the countries the protection of GI have a bearing on two underlying principles; namely

With a view to protect the consumers as well as the producers in the member countries a number of bilateral agreements have been created and administered through the World Intellectual Property Organisation (WIPO). The agreements like Paris Convention for the protection of Industrial Property, Lisbon Agreement for the Protection of Appellations of Origin and Their International Registration are some of the steps taken to protect the interests of the member countries. WIPO [26]states that “furthermore, through the work of the Standing Committee on the Law of Trademarks, Industrial Designs and Geographical Indications, made up of representatives of member States and interested organizations, WIPO explores new ways of enhancing the international protection of geographical indications.”

In the matter of the protection of the interests of the producers and consumers in the member countries EU has the most developed system of regulating the issues relating to GI. Coinciding with the common goal of achieving a ‘single market,’ the EU legislations always take into account the interest of the Community (first pillar) level.[27]  As detailed above the establishment of ‘Protected Designations of Origin’ and ‘Protected Geographical Indications’ by Regulation 2081/92 and ‘Traditional Specialties Guaranteed’ by the Regulation 2082/92 are the steps taken by the EU in the direction of protecting the interests of the member countries and the fact that these regulations will more or less be applied like law in the countries is an indication of the seriousness of the EU in the matter of protection of the GI.

Greece:

The GI and the protection issue as far as Greece is concerned mainly centers round the ‘feta’ cheese, which is basically a produce from Greece. The Feta cheese is a renowned Greek curd cheese that has a tradition dating back to several thousand years. In most part of the US the Wisconsin Cheese made from Cow’s milk has been sold as feta cheese onof the generic products as branded by the individual traders. Even in the EU the feta cheese was considered as a generic product and the production of the feta cheese can well be described as a fit example of the complexities involved in the evolution of the GI and the protection thereof.[28]

Before the protection was granted to the Greek cheese makers, the Feta cheese was being manufactured and exported by various producers in the EU including the Roquefort cheese producers whose product was already given the GI protection. All these producers including Roquefort cheese producers were resisting the grant of GI to the Greek producers. However in the year 2002 the European Commission allowed the establishment of a Protected Designation of Origins (PDO) for the Feta cheese declaring that the word ‘feta’ cannot any kind of generic cheese and the cheese having the label of feta cheese can be produced only in certain areas of Greece and that too from Goat’s or
sheep’s milk. With the result that the major cheese producers in Wisconsin USA are forbidden from making feta cheese in US unless they have production facilities back in Greece for the making of real feta cheese. The protection offered to Greek producers of feta cheese prohibits the Wisconsin makers from using the term ‘feta’. But “would the demand for this Wisconsin cheese disappear if it could not be called feta cheese—even if Greek feta commanded a larger price premium because feta cheese supplies were limited to the maximum volume that could be produced in the Macedonia, Thrace, Thessaly, Central Mainland, Peloponnese, and Lesbos prefectures of Greece?” – is yet to be seen.[29]

France:

The importance of the protection of GI is increasingly felt in France, being a member nation of EU. This is due to the fact that wine and cheese constitute major export products out of France and this has necessitated the framing the strictest possible rules and regulations governing the protection of GIs in respect of these products. Since the export of these two products have a direct bearing on the economic development of the country by enhancing the export earnings, France was keen to protect the designations of origin and locations of its products. With more thrust on protecting the producers of these signs rather than protecting the interests of the consumers, the country has made the regulations that have the objective of offering maximum protection to the makers of wine and cheese.

The protection mechanism of France works through the operation of two enactments that protect two forms of geographical indications. While Journal Officiel of the year 1905 governing the unfair competition protects the source indications the enactment of 1919 law[30] offers an enhanced protection to the appellations of origin. The basic requirement of the Act envisages the passing of the product through the legal channels for its recognition as an appellation of origin. There is also the requirement to prove the nexus between the locations of the origin and certain special qualities of the products.

The issues connected with Champagne are of significance in the issue of GI relating to France. An action was brought by the Champagne producers Comite Interprofessionnel du Vin de Champagne (CIVC), and the Institut National des Appellations d’ Origine (INAO) against the perfume giant Yves Saint Laurent for naming one of their products

as ‘Champagne’. The decision of the court went in favour of the Champagne makers and the perfumer was prohibited from using the name worldwide. “In France, Germany and Switzerland its use on the bottles of perfume was prohibited from the day the decision was issued”.[31]

In respect of the same issue relating to the use of the indication of ‘Champagne’ Germany was prohibited from using this name since 1919 under the Articles of the Versailles Treaty.

Germany:

Germany had a legislative framework consisted of various enactments that governed the protection of trademarks and identification rights. These laws were also governing the issues relating to geographical indications. A complete set of legal framework combining all these laws was formed in the form of the Trade Marks Act 1995 (MarkenG) modifying some of the provision of the existing laws.[32]  Articles 126-129 deal exclusively with the protection of geographical indications and Article 3 of the Unfair Competition Act (UWG) also contributes to the protection of the geographical indications in Germany. In fact the essence of the protection of the geographical indications is contained in the Unfair Competition Act in Germany.

The importance given to the protection of the geographical indications can be seen from the provisions of Article 3 of the Unfair Competition Act which is reproduced below:

“Any person, who, in course of business activity, for purposes of competition, makes deceptive statements, in particular concerning… The origin of individual goods or commercial services… May enjoined from making such statements”.

This provision is intended to act as the sole protection of the integrity of the manufacturers and traders and also the reliance of the consumers on the quality and location of the product as claimed by the GI. Two factors determine whether the provisions of Article 3 are attracted for establishing a violation of the GI. The statement used on the product with respect to its geographic location must be far from truth and misleading; secondly the statement should have the effect of misleading the consumers in respect of its quality because of the location indicated. It has to be proved beyond doubt that the mentioning of the location on the product induces the customer to comprehend the mention as a perception of the indication of the real origin and also such perception influences the buying decision of the consumers, then such indication of origin will be construed as misleading under the Article. These two factors are drawn out of the extent the impact the geographical mis-description influences the customer and the relevant trading community. It is customary for the courts to conduct surveys to establish any mis-descriptions of GI on the products.

Under German Law relating to trademarks the owner of  a GI right is entitled to claim a right of omission to prevent the third party from using the identification and also is entitled to right indemnity very similar to those provided for the protection of trademark infringement. Article 126 of the MarkenG the state law relating to trademarks provides that “The special characteristics or the quality of the products due to their geographical origin, as well as the existence of reputation are a sine qua non requirement for the grant of protection. If the marks have a wide reputation they are protected even though there is no risk of confusion, as long as the use of a geographical indication without proper cause harms the reputation of this indication or dilutes its distinctive character” (Article 126 MarkenG).[33]

Another feature of the protection of the GI is best exemplified by the Agreement of 8 March 1960 Between the Federal Republic of Germany and France on the Protection of Indications of Source, Appellations of Origin, and Other Geographical Denominations (the “Franco-German Agreement”). “The Franco-German Agreement contains a list of German geographic indications that are protected in France on the basis of German law and a list of French geographic indications that are protected in Germany on the basis of French law.”[34] It is mandatory that a new negotiation under this agreement need to be carried out for the inclusion of any new geographic indications to this list.

Belgium:

In Belgium the geographical Indications of origin receives protection from the government through the operation of the provisions of the unfair competition law and the law on the protection on the consumers. The registration of an indication which has a purpose of designating the geographical origin as a collective mark is provided for by the provisions of Benelux Law which is uniform throughout the Benelux countries. The provision however has a reservation that it is not possible for a third party who is entitled to use the mark cannot oppose such registration. Lack of clarity on the interpretation and applicability of the regulation 2081/92 has drawn wide spread criticism in Belgium[35].

Denmark:

The Registration and Collective and Certification Marks Act 1991 contain the provisions relating to the registration of trademarks in Denmark. The conditions governing the registration and certification of collective and certification marks are more or less similar to the Danish Trademarks Act. Article 3 of the Danish Law on Collective and certification marks specifically provides for the registration of marks that represent exclusively the signs or indications that may be construed as the geographical indication of the goods According to Ellen Breedam and Christian Kragelund[36] “This rule derogates from the general rule in the Danish Trademark Act under which marks cannot be registered, if they consist exclusively of a sign or indications which may serve, in trade, to designate the geographical origin of the goods.” If a product with a foreign GI is to be registered for a Danish certification, the Patent and Trademark Office in Denmark will require proof that such a GI is registered under any other rules within Denmark as a collective or certification mark.

There is no specific national registration system that governs the GI in Denmark. But the country follows the European Council’s regulation (EC) No 510/2006 dated 20th March 2006 that provides for the protection of GI and designations of origin created for protecting the agricultural products and foodstuff.

This regulation has made certain conditions to be fulfilled by the Danish agricultural goods for making them eligible for protection under Protected Designation of Origin or Protected Geographical Indication.

Further these regulations confer the property rights on GI to the rightful owners. Ellen Breedam and Christian Kragelund[37] reports that “The rules also state that either a group or a natural or legal person subject to certain conditions, are entitled to be rights holders of GIs by registration.”

Since the year 1994, Greece and Denmark were contesting in a case of dispute over feta cheese. In the year 1994, Greece first applied for the protection of ‘feta’ cheese which was objected to by Denmark, being the largest producer and exporter of cheese. The case was decided in favour of Demark by a EU court in the year 1999, that prohibited Greece from using the name ‘feta’ exclusively for the country’s cheese production. However, by a legislation established later, EU has made Greece the rightful owner of the Geographical indication for feta. Denmark has again sued the European Commission for the restoration of the rights over feta from Greece. GAIN report makes it explicit that “it is important to note that the word “feta” does not pertain to a town or even a region in Greece, but rather a term used to indicate the process used by cheese producers.  Although it is true that the process of making feta varies from country to country, this case leads many GI expansion opponents to wonder if this a just a matter of protectionism”[38].

United Kingdom:

Traditionally UK has been offering protection to various agricultural and other products by the prevailing law of passing off. The protection was also offered under the provisions of the Trademarks Act 1994, by enabling the trading community to get their trademarks registered under the Act to claim the protection. Section 49 and section 50 of the Act deal with the registration of collective and certification marks as Trademarks to ensure the protection thereof.  These provisions are now replaced in effect by the European Council regulations 509/2006 and 510/2006 which deals with the ‘agricultural products and foodstuffs as traditional specialties’ and ‘protection of geographical indications’ and ‘designations of origin for agricultural products and food stuffs’ respectively. The regulation # 1493/1999 dealing with the common organization of market in wine and regulation # 1576/89 governing the definition, description and presentation of spirit drinks also remain operative in the UK. Regulation 2392/89 deals with the general rules for the description and presentation of wines and grape musts.

There was an all round criticism in UK against the Community regulations governing the designations of origin and geographical indications. As far the regulation 2392/89 dealing with wines, the argument against the regulation was that there was no proper provision for the comparison with the trademarks registered earlier and no provision has been made to resolve the conflicts arising there from.[39]

The other criticisms raised were:

The legislation doesn’t provide for the cancellation or withdrawal of a registration if wrongly done.
“Although Article 1`4 makes provision permitting continued use of a trademark registered in good faith before the date on which the application to register the geographical indication or designation of origin was lodged, unless there are grounds for invalidity or revocation of the trademark as provided for in the EC Directive” [40] There is nothing to prohibit the use of well know unregistered marks.

The case of Consorzio Del Prosciutto Di Parma v.ASDA Stores Ltd and Another of the High Court of Justice, Chancery Division [41] can be considered relevant to the regulation no 2081/92. This case relates to the sales of pre-sliced and pre-packaged Parma ham supplied as boned and ready to be sliced by Consorzio group to the first dependent through the second dependent. The claim of  Consorzio was that the sale under the designation ‘Parma Ham’ by the first dependent was against the Regulations 2081/92 and 1107/96 as ‘Parma Ham’ was registered as an indication under Italian regulations that were incorporated under these two regulations. The Consorzio argued that the ham had to be packaged under the Parma region under the supervision of them. The High Court made the ruling that “although the Italian slicing and packaging regulations were referred to in the specification attached to the application, there was nothing in Article 4 which requires the product specification to include the subsequent commercial stages, such as slicing and packaging by persons other than farmers. There is no reason to suppose that every rule or provision of national law becomes protected simply because it is included in an application for registration of a name made to the Commission which is subsequently approved, and every reason to suppose the contrary”.

The Netherlands:

According to the prevailing legislations the geographical indications in the country of The Netherlands is protected by:

The Netherlands Civil Code: Under Article 6:194 provide for action against the misuse of geographical indications. Here the origin of goods is the key that determines the action under this law. Any information on the geographical location that has the effect of misleading the public is considered as an action suitable for Tort under the act. In case the action of any firm or trader in projecting the location as misleading information the following actions can arise under Article 6:194 of the Civil Code:

Actions for protection of the geographical indications may be initiated under the provisions of criminal law as mentioned in Articles 328bis and 327.
In respect of the community legislation, in order to regulate the local market on wine and also to ensure that the products are protected well, the government had formed two organizations; “Productschap voor wijn” for regulating the wines and “Productschap voor gedistilleerde dranken” for the protection of the products of spirits.[42]

Spain:

The protection offered to the geographical indications in Spain has produced remarkable changes in the country’s export activities. The country which is traditionally a non-export oriented one the results are phenomenal. The exports of GI products out of Spain had increased from 443 million Euro in the year 1991 to more than 1 billion Euro in the year 1999. The provisions of unfair competition law and trademark law protect the geographical indication and designations of origin in the country of Spain. There are other statues like Vineyards, Wine and Alcohols Law No. 25 of 2-12-1970 and it’s implementing Regulation of 23-3-1972 that take care of the protection of GI. Furthermore, “the Penal Code defines under Article 275 as a criminal offence involving industrial property the use in trade of a legally protected appellation of origin or geographical indication representing a specific quality on goods protected by the same provided such use is made in the awareness that the said appellation is protected”.[43]

Portugal:

In the country, the trademarks are governed by the Industrial Property Code approved by Decree Law 36 of 2003 with effect from July 2003. “This contains rules not only on trademarks and service marks, but also on patents, utility models, semiconductor topographies, models and designs, names and insignia of establishment, logos, appellations of origin and geographical indications. The code additionally includes provisions on protection against unfair competition”.[44] Several changes and amendments made to the industrial property codes in the years 1940, 1995 and 2003 had made clear references to the effect that the indications expressed by exclusive marks used purely in the commercial sense describing the quality, purpose, value and the like of the goods cannot be registered under the Code. The Codes provide that the marks for which an application for registration has been made must possess an exclusive inherent character and must also be similar to the previous registration or previous application for similar products. The goods must also fulfill all the legal requirements as per the Portuguese Industrial Property Code.

Italy:

Article 2598 of the Civil Code which represents the unfair competition law protects the geographical indications in Italy. The country largely based its protection laws on the relevant European Regulation. In order to make the laws correspond to the provisions of TRIPS Agreement the Italian Government has issued a Legislative Decree No 198 in the year 1996. Article 10 of the Decree made amendments to the law 1992/164 which rules the protection of indications of origin in the wine sector.[45]

Under the same law Article 31 was introduced to deal exclusively with the geographical indications. This Article provides that “a geographical indication is intended to be the one that indicates a country, a region or a resort, when it is used to identify a product that is originally of that area and whose quality or reputation or features are due exclusively or essentially to the geographical environment of origin, comprehensive of natural, human and traditional factors.”[46] While providing for the protection, the regulation also recognized the chances of the geographical indication being used as a means of unfair competition by claiming the specialty of the origin and quality of the products, though in reality the goods may not belong to the region or possess the qualities claimed by it. Thus the regulation provided for the protection against such unfair practices also.

The issue of the geographical indication in Italy was dealt with in the case of Pilsner Urquell v Industrie Poretti SpA[47] . In this case an Italian brewer was sued by a Czech for using the indication ‘Pilsen’ being the registered trademark of the latter on the Italian labels of the beer produced in Italy. It was decided by the Court of Appeal of Milan that

A designation of origin could not be regarded as the subject matter of exclusive rights if the term is used only to describe the quality of the product that is in reference and The reputation of a product for its quality and excellence also depends simply on the name of the indication.

While dealing with the final ruling in this case, the Court of Cessation observed that the sole purpose of the geographical indication is to reassure the consumer about the quality of the product based on its geographical origin. As distinct from the trademark that distinguishes the identity of the product the geographical indication vouches also for the quality of the product. Hence it is important to apply the provisions of the law governing the geographical indication for deciding on the issue. The Court ordered to collect the evidence relating to the registration of the product as a trade mark and also to decide whether following the registration as a trademark, the nature of geographical indication ceased to exist and the term had become a generic one devoid of the features of the GI.[48]

Development of European Regime: EC Regulation No 2081/92:

Much of the EU legislation governing the geographical indications are encompassed in the Regulation (EEC) No 2081/92 that covers the ‘protection of geographical indications’ and ‘designations of origin for agricultural products and foodstuffs’[49].

In addition to these two prospective protections, the regulation (EEC) No 2082/92 has made explicit provisions for protection of traditional recipes under ‘Traditional Specialties Guaranteed’.

Though there distinctions in the definitions of the two terms ‘protection of geographical indications’ and ‘designations of origin for agricultural products and foodstuffs’ there are no differences in the procedures prescribed by them or the protection to the products they offer. “The distinction has significance primarily in terms of what label (PDO or PGI) is affixed to products protected under the regulation. Only products meeting the requirements of this regulation may bear such labels”.[50]

These Regulations are supposed to be followed by the member nations as a prevailing law in their respective states and the object of the enactment is observed as to enable the customers to make the best choice by providing them “clear and succinct information regarding the origin of the product.”

Regulation 2081/92 provides for the following rules in connection with the geographical indications:

Protected Designations of Origin (PDO):

“Quality of characteristics of a product must be essentially or exclusively due to the particular geographical environment (including natural and human factors such as climate, soil quality and local know-how) of the place of origin Production and processing of the raw material, up to the stage of the finished product must take place in the defined geographical area.”

The purpose of establishing these conditions is to have a “close and objective link’ between the characteristic features of the products and its geographical place of origin. This brings into the ambit the legal concept of ‘terroir’ with reference to the location and indications of the products. The regulation also provides for exceptions in cases of the product which carries a name that is not the name of a place or region but is synonymous with the product to be registered as a geographical indication.[52]  There are also provisions to cover instances where the raw material is sourced from a larger geographic region consisting more than one place. However the condition is that such registration is to be applied within a definite time frame.

Protected Geographical Indications (PGI):

This part of the regulation covers the following aspects of GI:

“At least one stage of the production of the protected product is undertaken within the geographical area. This covers ever products that are being made with raw material which is imported. There must be link between the product and the area; though this need not be exclusive or essential. A specific quality or reputation may be sufficient to link the product with the geographical area.”

Though it is mandatory to establish a link but it is not necessary that must be very close or objective. The link may be established on the basis of the reputation and market standing of the product at the time when the application for registration of the GI for the respective product is made with the appropriate authorities. It is also left to the choice of the individual producer or other groups of producers to determine themselves whether the application need to be made to the PDO pr PGI protection depending upon their individual and group needs.

This regulation prohibits the registration of ‘generic names’ that have become common with the products to be registered as PDO or PGI though such names in reality represent the name of a region or location. There is no exhaustive list of generic names that fall within this category. The decision will be made by the authorities on the classification of such name as a generic one or otherwise as and when an attempt is made to register any name.

In addition to these two provisions for protection of GI, regulation 2082/92 had included the grant of a certification of a unique character called ‘Traditional Specialties Guaranteed’ (TSG). The features thereof are:

“The product must have distinguishing features that set it apart from other agricultural product or foodstuff in the same category. This could include taste or specific raw materials. However, the special character cannot be a particular geographical origin. The product’s specific character must be “traditional” in that it uses traditional raw materials, or is produced or processed in a traditional way” It has been specified that the name or symbol that characterizes the product and is being used for registration of the product must exhibit the special feature of the product or the name or symbol itself should be specific. The object of introduction of this additional facility for registration is to enable the makers to stress the traditional attributes of the product, if it is dominant than the geographical dimensions of the product and thus TSG complements the other two categories of protection granted to the products under the regulation 2081/92.

TSG covers most of the food and non-food agricultural products.[53] As of the year 2003, at least 700 products got registered as PDOs, PGIs or TSGs.  The products covered under these regulatory provisions include cheese, fresh meats, meat-based products, honey, olive oil, fruits and vegetables. A list of the distribution of the PDOs and PGIs registered by the EU countries as of the year 2003 is exhibited in the following table:

The more and more products registered under these regulatory provisions indicate that there was a marked shift in the nature of protection the makers wanted for their products in that apart from protecting the renowned and famous geographical products, the tendency was also to protect the local products about which little would have known to people outside of their respective countries.

From the table it may be observed that southern European countries like Italy, Portugal, Greece, Spain and France were active in protecting their local produce for differentiating their local products form the products of other countries. As of the date this tabulated report, the Northern countries like Finland, Sweden were yet to get in to the process of getting their products registered under the regulations. But Germany had shown considerable interest in the process and got 64 of its products registered showing that the country had a really distinct food system.

GATT/TRIPS:

The General Agreement on Trade and Tariff (GATT) Trade Related Aspects of Intellectual Property Rights (TRIPS) was initiated in the Uruguay round of the World Trade Organisation (WTO) trade talks among member countries in the year 1994.

“It is the most significant international agreement regarding Intellectual Property rights, introducing IP laws into the international trade arena for the first time.”[55]  .Every member of the WTO is under the obligation to implement the terms of the agreement. The main emphasis of the Agreement is on the protection of copyrights. The GATT TRIPS provides for the registration, protection and other administration of the copyrights. The agreement among other things provides for the protection of the computer programming by categorizing this as a literary contribution. Perhaps this is the most apt provision of the GATT TRIPS Agreement that goes well with most of the nations that have a strong base in Information and Communication Technology for their economic development like India and China. In addition the Agreement also insists on the member countries for forming legislative frameworks in respect of patent laws especially such laws to cover technological innovations and botanical discoveries that are considered related to the hard work of the individuals and nations. “Provisions within the agreement also demand that national protection for patents and copyright be limited. In terms of these rights, citizens should not receive favoritism from national governments”[56].

There were controversies on the GATT TRIPS Agreement since its initiation in the Uruguay Round of Talks of the WTO. The controversies basically center round the burden the agreement places on the poor and developing nations who are compelled to adhere to the prescribed standards in the agreement in order to retain their memberships. The effect of the agreement may be seen from the fact that in respect of medicines, the developing nations are not able to market the medicines domestically at the market rates mostly due the influence of the patent holders of the medicines who normally belong to the developed countries. This issue can further be illustrated by the hindrance of the progress of combating the AIDS crisis in Africa.

Salient Features of TRIPS Agreement:

The Agreement on Trade – Related Aspects of Intellectual Property Rights (TRIPS Agreement) is the first WTO agreement that puts an obligation on the part of the members to adhere to certain minimum standards in respect of the establishment of the procedures for enforcement and also the prescription of the norms within their established legal framework. The TRIPS Agreement usually involves itself in negotiations over a wide range of intellectual property rights like copyright, trademark and so on. The scope of the Agreement also encompasses the regulation of competitive markets, measures for enforcement, settlement of disputes and transitional arrangements.[57]

The issues relating to the geographical indications and the protection thereof gained momentum when the issue was included in the agenda for the Uruguay Round of the Talks on General Agreement on Tariffs and Trade for discussion under the intellectual property issues. This inclusion has changed the nature of the issues to a multilateral base form its original national, bilateral or plurilateral nature.[58] The TRIPS Agreement can be regarded as a part of the ‘single undertaking’ of the WTO and thus become applicable to all the members of the WTO. The provisions of the TRIPS Agreement are basically framed on the strength of the Dispute Settlement Understanding that comprises of the dispute settlement procedures of WTO. The TRIPS Council is in charge of the supervision of the TRIPS Agreement and the World Intellectual Property Organisation is entrusted with a minor role of supervision in some of the intellectual property matters.

Article 22:2 of the Agreement describes the main objective of the TRIPS Agreement by requiring the member countries to “provide the legal means for interested parties to prevent” the use of any means “in the designation or presentation of a good that indicates or suggests that the good in question originates in a geographical area other than the true place of origin in a manner that misleads the public as to the geographical origin of the good,” as well as any use “which constitutes an act of unfair competition.”  (Article 22:2)

“The same article continues by enjoining Members to refuse or invalidate a trademark which contains or consists of a geographical indication with respect to goods not originating in the territory indicated, if the use of the indication in the trade mark for such goods in that Member is of such a nature as to mislead the public as to the true place of origin.”[59]

Wines and Spirits:

The TRIPS Agreement provides specific regulations regarding the GI for wines and spirits. The rules prescribed under the agreement prohibit the use of words ‘like’ and ‘type’ so that the protected products are not copied by the competitive producers. Similarly under the rule there is a prescription for a registry for wines. The ‘grandfathering’ of an existing identical product of wine is also provided for in the regulations. William Hennessey (2005)[60] observes “In particular, “wines and spirits” are being given special treatment. Unlike other forms of intellectual property protected under the TRIPS Agreement, geographical indications for wines and spirits are to be afforded “super-protection” from competition beyond that for other products”. Article 23, entitled “Additional Protection for Geographical Indications for Wines and Spirits,” mandates that “the registration of a trademark for wines which contains or consists of a geographical indication identifying wines or for spirits which contains or consists of a geographical indication identifying spirits shall be refused or invalidated, ex officio if domestic legislation so permits or at the request of an interested party, with respect to such wines or spirits not having this origin.”

Settlement of Potential Disputes under TRIPS:

The area of Geographical Indication is one that potentially may lead to certain disputes among the members of the WTO. “There are competing claims to entitlement to the names of strains of rice and varieties of tea that are popular among consumers around the world, and which originated in particular geographic regions”[61]. The main objective of the TRIPS council is to embark upon more precise rules to bring an end to the different arguments from the competing nations by arriving at a comprehensive solution.

Dual Model of Regulation under TRIPS:

Under TRIPS agreement the dual model of regulation is being practiced in that there is a provision for an increased protection for wines and spirits under the agreement. But the protection for agricultural products and food stuffs are left to the discretion of the respective national governments Article 23 of the TRIPS Agreement provides for the protection of the French wine and spirit manufacturers since the industry has a tradition of more than 200 years.

Special Protection for Wines and Spirits:

Under Article 23 of the agreement the wine and spirit industry is provided with a discreet sub-system of transnational protection. Under this regulation the following steps are prescribed:

The establishment of a voluntary multilateral system of registration and notification of the GIs for wines and spirits eligible for protection.
Secondly a protection of the highest order against the use of the GIs for providing misleading information to the consumers is being offered to the producers. Under Article 23.1 the member countries are provided with the power to extend legal assistance to the producers of wines and spirits to protect their products against unauthorized use of the GI for promoting the goods which are not originating in the location indicated in the GI. The Agreement also provides for the refusal or cancellation of the trademarks covering the GIs on its own by the member nations or on the claim of an interested party. “Moreover, this prohibition, borrowing from Article 3 of the Lisbon Agreement, includes indications which refer to the true origin of such goods, or where the GI is used in translation, or where the GI “is accompanied by expressions such as ‘kind’, ‘type’, ‘style’, ‘imitation’or the ‘like’”[62] The high level exclusive protection offered to wines and spirits implies a dilution-style protection for trademarks. Therefore it becomes an infringement if a GI is put to use for promoting a similar product if such use would result in the lowering of the reputation of the original product or would amount to the misuse of the indication to represent an inferior product.[63]

General Protection against Unfair Competition for All Products:

Unlike the wines and spirits the agricultural products, food and foodstuffs and handicrafts do not enjoy any high level protection and also there is no provision for a multilateral register. As such these products are prone to infringement as there are no stricter provisions for protection of these goods. However provisions have been made to prevent any unauthorized use of GIs against misrepresentations and deceptive descriptions. “Codifying existing international protection against unfair trade practices, Article 22.2 sets out to prohibit any use which ‘constitutes an act of unfair competition under Article 10bis of the Paris Convention’”.[64] However the TRIPS Agreement extends the coverage of Article 10bis to a GI ‘which, although literally true as to a territory, region or locality in which the goods originate, falsely represents to the public that the goods originate in another territory’.

Apart from the above provisions, as per Article 22.4 the protection offered under Article 22.1 to 22.3 to different goods must be extended to all the GIs by the products that are deceptively similar to the original products though they falsely represent to the people that they originate from the territory indicated, but in reality they do not.

It must be noted that such protection is not comparable to the high level protection being offered to wines and spirits. The registration and administration of a trademark resembling a GI thus depends on the misleading use thereof. Under Article 22.2 the registration for trademarks for goods not emanating from the location indicated must be reused or cancelled where such marks represent a deception or misinformation to the public.

Shortcomings of TRIPS Agreement:

The TRIPS Agreement left some issues undecided which made the application of the rules enacted under the Agreement difficult. Firstly, there are no precise definitions of the geographical units that the agreement is talking about as to whether it should be a country or it represents a region within a country. Theses definitional problems were finally had to be referred to a Dispute Settlement Panel. Excluding the GIs with the country names and adopting the names only with the regions within the country posed a problem for smaller countries. It also posed difficulties in the case of products where the quality is considered to be the widespread skills of the local people belonging to a particular country or region. Examples in this context are Thai Silk or Canadian Whiskey. Including such products for protection by offering the GI resulted in high fragmentation of the market domestically in the countries concerned. In addition such inclusion also presented difficulties for the WTO to comply with its own rules based on the concept of ‘like products’.

The EU challenged the GIs based on the countries that since have been ceased to exist, like for example the ‘ceylon tea’. However this move could be countered by the argument that the customer information is adequate to identify the quality of the product irrespective of the political name change in respect of the country concerned. Another problem was posed by the plant varieties like ‘basmati rice’ that can be grown in any place. “In the case of wine, provision is already built into the TRIPS rules (Article 24:6) to allow varietal labels to be used in some regions even if that name is claimed as a GI by another country.” [65]

“Protection of “Traditional Expressions” such as “vintage” or “ruby” for port also posed issues of definition: it would seem to be a stretch in the concept of geographically-based quality assurance” (Josling, Roberts and Orden, 2004, p. 135)[66]

EU/US Dispute:

The EU-US trade relationship assumes greater importance in to-days’ global economic scenario that grows day by day. The relationship has a significant effect not only on the bilateral economic relations of these two large economic regions of the world but also has its effect on the political adjustments between the territories. The relationship assumes greater importance also due to the fact that the trade relations between these two countries make for at least 40 percent of the world trade, in that any strain arising on the political cooperation will affect the commercial relations heavily and vice-versa.

Euractiv article (2002)[67] observes There is currently a long list of US-EU trade disputes ranging from unresolved issues, such as the EU refusal to allow imports of hormone treated beef (despite a contrary WTO ruling), to those disputes that are only just about to erupt, such as the potential row over the imposition of tariffs on US steel imports.

In addition to these existing disputes the US backed by Australia brought about an issue for discussion that related to the consistency by the WTO of protections initiated by the European Union under one of its regulations.[68]  The protection sought for by the EU relates to the agricultural products and foodstuffs. The issue was that while WTO members are bent on liberalizing trade in agricultural products through negotiations in different forum of WTO, the regulation brought forward by EU had the effect of limiting the competition from the imported produce for much of its agricultural products and food stuffs. It may be recalled that Article 22 of WTO TRIPS Agreement defines the geographical indications as “indications which identify a good as originating in the territory of a Member, or a region or locality in that territory, where a given quality, reputation or other characteristic of the good is essentially attributable to its geographical origin.”[69] According to this definition the registration of the GI would be available only for goods produced from a specified territory and such goods can bear the GI. It is also assumed that the firm that has got the GI could derive the competitive advantage out of the registration of the GI and that also acts as a protection from infringement for the particular goods covered by the indication. However the regulation proposed to be brought in by the EU set forth the various procedural requirements for getting the GI registered and also the described the extent to which the protection in respect of the intellectual property protection available to such GIs registered. The issue raised by the opponents to the regulation is that it had the effect of limiting the use of GIs to the products emanating from the EU and thereby placed the imports in to EU from the other countries at a disadvantageous position with respect to the competition with the domestic produce of EU.

Arguments and outcomes in the WTO dispute:

As aforesaid the main contention of the US led opposition is that the EU regulation is only favouring the farmers in the EU member nations and it doesn’t consider the protection and welfare of other WTO member countries. Thought the intention of the WTO TRIPS agreement is to extend the benefits of the protection of GIs to all member countries by the operation of the provisions of the Articles 22 and 23 of the Agreement, the EU by using its “narrow technical language of the regulation” align with the “famously vague imprecise language of the WTO Rules” tried to take advantage of the GI rules only to its member countries at the cost of other WTO member nations. This was the main argument that the opposition to the regulation put forth to WTO to resolve.

While several aspects of the regulations were found be inconsistent with the WTO Rules, the WTO Panel instead of altogether condemning the regulation required the EU to make amendments to the regulation. These amendments were recommended to correct the violations that the regulation originally had. The amendments were welcomed by both the sides to the dispute. The US led opponents to the regulations contend that the amendments proposed by the WTO panel will substantially address the concerns raised by them by making the protection of GIs available to all the products originating from the countries outside the European Union as they are available to the products of the EU member nations. The EU side was also considering the amendments as favourable to them as they will allow the EU to maintain a system of registration that will protect the EU products with the GI as there had been incidents increasingly happening in which the products outside EU region were also using the name of the EU locations. These misuses will now be under control. Names like beaujolas wine, Champagne and parmesean cheese which denote the origin as EU were being used by makers outside the EU even though the products did not correspond in quality or location to the original ones. Moreover within the EU also the goods which indicate the origin of the location as an EU country will really be originating from the indicated location. Under the EU regulation only those products originating in the indicated region is allowed to use the geographical indication.

The case is really worth noting to judge the efficiency of the WTO panel in resolving an economically important issue affecting almost all the members of the WTO. In deciding on the issue the Panel “evaluated the ‘thrust and effect’ of the regulation on the parties and the market in light of the purpose and intent of the WTO rules at issue”[70]

The National Treatment Argument:

The National Treatment Obligation under TRIPS requires that each WTO member should ensure that the ‘nationals’ of another WTO member country should receive a treatment that is to be at least not less favourable than the treatment the country would otherwise accord to its own ‘nationals’. Article III of the GATT 1994 requires that the products made in the territory of another member should be provided an equal treatment as if the products are produced in its own territory. The WTO panel recognizes the fact that the differences in the treatment envisaged by the European Union is only on the basis of the location of the geographical indication and not on the basis of the nationality of the producer seeking the protection for the GI. “Nevertheless the Panel found a violation of National Treatment obligations based on the effect of the Regulation. It noted that, while in theory non-EU nations might seek protection for GIs in the EU and EU nationals might seek protection for GIs outside the EU, in fact this was rarely the case”[71].  The panel also clarified the point that although the regulations relating to the protection of the geographical indication relates to the geographical locations and not the particular products covered by the GI, the GI registration will first related to the products and any problems arising in registration would be construed as being related to the products from the region concerned.

The Trade Mark Argument:

Another contention of the opponents is that the regulation allows the trade marks previously registered under the legislations governing the trademarks registration to provide the protection concurrently to the registered users along with the registered GIs was inconsistent with the TRIPS agreement. However while considering the actual operation of the regulation the WTO Panel concluded that the provision allowing the co-existence of GIs and the already registered trademarks in respect of the same region could be considered for continuance and it will not in any way considered as the violation of the provisions of the TRIPS agreement. However the Panel went along with the views of the US and Australia in providing that as per the rules under TRIPS[72] the trade mark owners should be allowed to make a claim to prevent the subsequent protection being granted under GI wherever there is a likelihood of confusion or dispute arising. The Panel however noted that under the other provisions of TRIPS [73]such right to claim is limited in cases where the legitimate interests of the owners of the trademarks or other third parties are well protected. “Turning to the facts before it, the Panel pointed out that the relevant right of trademark owners and third parties was to prevent consumer confusion and there was no evidence that the co-existence of trademarks and subsequent GIs resulted in the likelihood of confusion.”[74] The panel also pointed out the fact that out of the 600 and odd that have been registered over a period of 8 years, there had been only 4 cases in which a duplication of protection under GI as well as Trademarks is complained of, where the GI registration might cause a likely confusion with a previous registration of a trademark for the same item.

The Outcome ‘Who Won What’:

In effect the WTO panel had confirmed that the GI registrations could not in any way come in the way of the rights of the owners of the US Trade mark owners. However under very specific and narrowly defined cases it may happen that such overlapping may occur. On the other had the EU can protect all the registered GI names under the regulations but it may not be possible for the EU to protect the variations including the linguistic variations of that name. It may be possible that some of such registration may cover brand names prevalent in other countries.

“The panel ruled that Regulation No. 2081/92 violates the TRIPS Agreement with respect to the requirement that applications be submitted by governments, the requirement that objections be submitted through governments, and the requirement that governments participate in inspection procedures. The panel suggested that the regulation be amended.”[75]

Conversely the WTO Panel ruled that there was no violation of the Article 22.2 of the TRIPS Agreement by providing for the co-existence of the GIs and the previously registered trademarks with similar indications or distinguishing marks. In other words the WTO Panel ruled that the GIs are compatible with the systems of trademarks and their registration. Since the panel has upheld some of the arguments from both the sides it cannot be said ‘who won what?’

Post –dispute action: EC Regulation 510/2006:

As a continuation of the EU’s efforts in the protection of the GI of the products of their member countries is the promulgation of the European Council Regulation (EC) No 510/2006 of the 20th March 2006 as an improvement over the earlier regulations on protection of geographical indication and designations of origin for agricultural products and food stuffs state among other things the following:

“In accordance with the rules in Council Regulation (EC) No 510/2006 applications to register GIs must be published in order for third parties to oppose to the final registration. The publication takes place in the Official Journal of the European Communities.

The rules in Council Regulation (EC) No 510/2006 further state that objections can only be raised by a member state or by a natural or legal person who objects through the competent authority of the Member State in which he resides or is established.

• Furthermore, the rules in the Council Regulation state that a GI registration can only be opposed if;
• it is shown that there is non–compliance with the conditions concerning the definition of the GI,
• or the GI is in conflict with names of plant varieties, animal breeds, homonyms and trademarks
• or show that the proposed registration of a name would jeopardize the existence of an entirely or partly identical name or trade mark, or the existence of products which are legally on the market at the time of publication of this regulation in the Official Journal of the European Communities,
• or indicate the features which demonstrate that the name whose registration is applied for is generic by nature.”[77]

Thus the regulation 510/2006 provides for improvements over the previous legislation of 2081/92 on the same issues.

GIs under Doha Round:

The participating countries witnessed somewhat a complicated approach to the whole issue of GI in the Doha Round. This was due to the fact no country was clear as to what to be negotiated and which is the forum to negotiate for their demands. One significant development was the agreement by the countries in a Special Session of the Council Meeting of TRIPS to carry on with the negotiations as mandated in Article 23:4, in connection with the registry especially opted for wines and spirits. Even though these negotiations started way back in 1997, still no agreement could be reached on this issue.

Another rather contradictory issue that was put to discussion was the claim by several countries, EU predominant among them for the extension of the additional protection granted under Article 23 to other agricultural products in addition to wines and spirits. But the result was that no negotiations have been initiated in this respect. An agreement could not be reached whether such negotiations should form part of the agenda of the TRIPS council meeting or should be carried to the forum of WTO talks on agriculture and allied commodities. The idea of mooting such negotiations would have resulted in large advantages to some countries, while it would have been detrimental to some other countries and hence an opposition to the idea was also witnessed in the Doha Round of Talks.

In fact two proposals were presented for negotiations in respect of the multilateral registration as articulated by the EU. One of the proposals called ‘The Joint Paper’ was presented by countries under the lead taken by US. The countries that backed the proposal by the US were Australia, Argentina, Canada and Japan. According to this proposal, the multilateral system should be through a voluntary basis where the details of the already notified GIs would be entered into a data base. Countries desirous of setting their own GIs can refer to this data base and determine their internal GI accordingly.

The other proposal was presented by EU countries along with Switzerland, other European countries and Sri Lanka. As per the system proposed by EU, the registration of GI has to be carried out through a register. Once registered, the products will get the automatic protection. The countries are given an option to protest against the registration within 18 months of such registration and announce their unwillingness to protect any particular GI already entered in the register.[78] The country Hong Kong tried to strike a via media between the two proposals and presented a paper according to this view.

Another issue that was dealt with in detail at the Doha Rounds was the question of extending the protection to other goods in addition to wine and spirit under Article 23. The methodology followed was to include the issues under ‘Implementation of Uruguay Round Agreement’ and the TRIPS council was advised to report the progress thereof.

Here again there were two groups of countries; one including Switzerland, EU and other countries lending support to the compulsory multilateral registration for wine and spirits argued for the extension of the protection to other commodities. Thailand also joined this group of countries. On the other side was the countries who were against the compulsory registration supported the view that the existing protections were more than adequate and there was no need to extend the protection to other products which would have the effect of impeding the natural tendencies of the products and the people. A conclusion was drawn to the Doha Rounds by the forming of the July Framework Agreement (WTO 2005) that required the Director General to use his good offices to intervene and break the deadlock to arrive at some solution and to report the progress to the Trade Negotiating Committee. It may be witnessed that the question of GI registration and tis extension would form a significant part of the further round of talks as the negotiations getting closer and the countries would strive to take the maximum advantage by asserting  their individual positions on this issue.

Concluding Remarks:

Irrespective of the pressures on the changes in the modality of the registration of GIs, the protection arising there from has been justified from the consumer point of view as a boon for providing him the fullest information that he needs on the products. Protection of the GIs is always to the benefit of such producers who will be able to meet the quality expectations of the consumers and who will be able to substantiate the reputation of the product as claimed by the GI. The implication of the protection under GI is that though the GI is initiated as an action from the producers the aim of such protection is to act mostly in the interests of the consumers. Hence the efforts to protect those GIs where the chances of deception or there is no information available with respect to the product concerned will be found to be very less. “On the other hand, in a world where trade in differentiated products is expanding and producer incomes from satisfying consumer desires for quality and variety in foodstuffs are replacing subsidies from government budgets, assisting the market in meeting such demands is both politically wise and economically defensible”[79] by means of providing protection in respect of those products that contribute towards these ends. The biggest issue in front of the WTO is to strike balance between theses two objectives without compromising on the efficiencies of the trading systems in operation in the member countries also under a disintegrated and mostly bureaucratic regime.

Basically there are three different issues centering round the GI were discussed in this paper. They are:

As far as the multilateral register is concerned the alternative suggested is to negotiate   bilateral agreements between the EU and other countries through a system of extended trade relations. A similar arrangement could be worked out by the US and the countries that will enter in to trading with the US. The arguments went in favour of such bilateral agreements were:

With respect to the extension of the protection to the products other than wines and spirits, it seems that there is no merit in extending the protection to other products on the basis of deception issues. Already the protection granted to wines and spirits may turn out to be excessive and could well affect the competition and other developments jeopardizing the broad interests of the consumers.[80] However an argument in favour of providing for additional protection to different products may arise on the basis of improvements in quality and more information to the consumers for individual products on the basis that the level of protection being offered by Article 22 is insufficient to achieve the objectives of GI. May be this argument needs to be considered in certain cases but need not be provided for indiscriminately across the board for all the products.

This means that the products to claim the protection under Article 23 need to be considered on the merits of the individual cases and not on a more generalized basis.

In the question of running of the protection concurrently on the basis of the trademarks and GI the WTO Panel had arrived at some compromising solution that was acceptable to both the sides that raised the issues. The policy to continue the provision of GI along with the previously registered trademarks should find its exit in the course of time. The alternative that merits consideration is to transfer the protection to the common group of eligible producers along with compensation on some agreeable ground in cases where the existing GIs have trademark protection also. If this can be accomplished then there will be no need to provide for protection of GIs under Trademark laws without establishing the chances for a potential conflict between both trademarks and GI.

One major issue that needs mention as a concluding remark is that the discussion on the issues dealt with by the paper has not been supported by any empirical base. The economic challenges presented by the issues relating to GI are too many involving billions of dollars affecting the economies of different countries. Some important questions arise in this context that could be answered over the period of time.

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