Geographical Indications and Agricultural Community Development: Is the European Model Appropriate for Developing Countries?
Chapter 9
Geographical Indications and Agricultural Community Development: Is the European Model Appropriate for Developing Countries?
Introduction
Are geographical indications (GIs) truly beneficial for developing countries? And, if they are, how can they best be used to promote agricultural community development? This chapter seeks answers, taking into account European experience as well as developing country experience to the extent that the latter is able so far to provide any clear lessons.
According to the World Trade Organization’s Agreement on Trade-related Aspects of Intellectual Property Rights (TRIPS), GIs are ‘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’.2 The idea of communicating origin to consumers and other traders by words or signs goes far back in time. But with the inclusion of GIs in TRIPS, they are now part of international trade law.
Unquestionably, the underlying purpose of including GIs in the text of TRIPS was to protect the interests of European producers, mostly those of wines and spirits who are able to enjoy additional protection as compared to other types of product that may be important items of trade within Europe, but are less important globally. These include foodstuffs such as cheeses and processed meats. Little thought was given during the negotiations to the use of GIs as means to further the trade and development interests of the developing countries, even less to promote, valorize and generate income from traditional knowledge-based products.
However, since 1995 when TRIPS came into force, there has been a growth of interest in the trade and development aspects of GIs. Even so, few detailed empirical studies have been conducted on the operations of GI regimes in developing countries, or that have any obviously direct applicability to such nations.
Many European advocates of GIs assert that many relatively backward agricultural communities have gained from use of GIs. In consequence, their wider adoption could benefit such populations elsewhere in the world. The European Union, as does the Swiss government, funds technical assistance programmes that promote the adoption of GI laws and regulations, and guidance on how to implement them. Putting aside the obvious political motivations behind such efforts, one must admit that there is a genuine conviction among officials at the European Commission that GIs are good for developing countries, including in the context of local development.
Most developing countries do see a value in GIs, and more and more countries are passing sui generis GIs legislation with TRIPS and the EU system forming the key points of reference whether or not newly framed national regimes look much like it. Further, they generally agree with the European Union’s position on extending the additional protection available under TRIPS for wines and spirits to all other types of product. But beyond that the consensus breaks down.
Some developing countries are understandably concerned that since most of the world’s GIs, especially those with well-established market positions, are European, increased intellectual property rents will in the short to medium term accrue to Europe whilst sales of products of theirs that compete with GI-protected European ones will be harmed. Indeed, those countries established in their modern form by European settlers tend to be the most sceptical about the worth of GIs and the most cynical about European motivations. It is not difficult to see why: through a process described by Alfred Crosby, which he called ‘ecological imperialism’,3 settlers turned vast tracts of land including indigenous peoples’ territories into what one might call ‘offshore Europes’ containing plants and animals carried with them from Europe that were cultivated and improved with European agricultural practices, and in sites and regions having the same place names as those from the continent they had left. In this context, one should not be too surprised that it was Australia and the United States, both major producers of old world agricultural commodities, foodstuffs and beverages, who made a formal complaint at the WTO against the European Community for its methods of protecting GIs, largely, it must be said, its own. Both countries alleged that these were incompatible with TRIPS concerning national treatment, most-favoured-nation and trademark protection. The Dispute Panel formed to consider the merits of the complaint did not fully accept the position of Australia and the US, but did concur with the complainants’ view that the Regulation violated the national treatment provision in TRIPS by discriminating against foreign nationals seeking to have their GIs registered in Europe.4 The overwhelming majority of indications in force in Europe continue to be for products of European origin, although there has been a recent increase in non-European registrations.
Be that as it may, there is no disputing that Europe has by far the most experience and could offer useful learning for developing countries. But it is important to bear in mind the very different legal, economic, social and political contexts of different countries, as well as the capacity challenges as demonstrated by the Saint Lucia case study described below. There are some well-known and long-established GIs in developing countries that have all been quite successful, albeit usually protected by trademarks rather than sui generis GI regimes. These include Darjeeling tea from India, Jamaica Blue Mountain coffee, tequila from Mexico, and coffees from Colombia and Guatemala. However, these are prestigious products, with goodwill and profitable exports established long before their GI protection.
For small-scale and widely dispersed producers, such as coffee growers in Ethiopia to give just one example, boundary-setting, standardization and quality control measures can be very difficult, if not impossible, to put into place. Regarding the lessons learned, as one commentator has observed, ‘although substantial research has been conducted on European GI systems …, very few comprehensive studies have been carried out on the specific challenges associated with the implementation of GI schemes outside of Europe’.5
A Very European IP? The European sui generis Geographical Indications Regimes
The TRIPS definition says little about what a GIs regime should actually look like. If we view GIs as a category of IP, they would appear to have a very short history. Related terms like indications of source and appellations of origin were included in the 1891 Madrid Agreement on the Repression of False or Deceptive Indications of Source in Goods, and in the 1958 Lisbon Agreement for the Protection of Appellations of Origin and their International Protection. However, ‘geographical indication’, of which indications of source and appellations of origin may be considered a subset, is much more recent.6
More than 15 years after TRIPS came into force the legal concept of GIs remains somewhat fuzzy. How WTO members should provide the legal means to protect such indications is ‘strategically vague’ allowing for much flexibility. Accordingly, there are diverse ways by which an indication of geographical origin, and the product so indicated, may be protected legally. This gives WTO members broad scope to draw up implementing laws and regulations as they see fit. Different countries may well protect them under original and specific (sui generis) GI laws, as in the European Union and India. But they may alternatively – or additionally – be protected largely or completely under the following: an appellation (or designation) of origin regime; trademark law, or in some countries influenced by English law under the common law tort of passing off as with unregistered trademarks; or indirectly through unfair competition law.
They may in fact be embedded within areas of law and regulation other than IP according to the underlying purpose of protecting them, such as: consumer protection rules relating to trade descriptions or food product labelling; cultural heritage regulations and policies; or rural development regulations and policies.
The role of the state may be minimal, simply providing the legal framework and granting rights. Or else the state may be directly involved in overseeing the regulation and enforcement of GIs. Thus, GIs are not a type of IP as is the patent, copyright or trade mark. Perhaps it is best to think of ‘geographical indication’ as a convenient catch-all term for a variety of mostly currently-existing laws and regulations concerning products that are differentiated by possessing features or a reputation attributable to their spatial origins. In this sense, GIs have a much longer history than the term itself.
What we can say with certainty is that like sui generis plant variety protection (and its international incarnation as UPOV), GIs are of European origin. Indeed, it is no secret that the reason for their inclusion in the Uruguay Round of trade negotiations of the late 1980s and early 1990s that lead to the establishment of the WTO was a direct consequence of proposals made by the European Community and by Switzerland. More GIs relate to goods of European origin than to those of any other region or country in the world, in fact most likely the rest of the world put together. While important to note this, it does not automatically follow that GIs are unsuited to other regions that differ markedly from Europe in terms of culture and economic conditions. But at the very least, it might help to explain the continued relative absence of effective national GI regimes in more than a handful of developing countries.
Probably the longest established geographical indications regime is the French appellations of origin system for products considered to be distinctively local due to a combination of traditional know-how and highly localized natural conditions.7 This dates back to a law passed in 1905 but it became truly effective only from the mid-1930s once policymakers learned how best to remedy the original system’s flaws. The appellations of origin system evolved in response to problems of fraudulent or misleading labelling, poor quality control and overproduction. A government agency, the Institut National de l’Origine et de la Qualité (INAO) validates Appellations d’Origine Contrôlée, so that producers of wines, spirits, dairy and agricultural products, whose goods are renowned for their distinctive qualities and geographic origins, are protected from those who would undermine or exploit their good reputation by making similar, but false, claims. Applications are made by producer associations, and these are scrutinized by committees of inquiry composed of members of the national committee and expert appointees who may draw up production conditions that users of the indication must comply with. The INAO, the committees, and the associations cooperate to make the system of accreditation, management and enforcement, operate effectively.8 There are similar regimes in Italy, Spain and Switzerland among other European countries. Europe has the most elaborate GI regime in the world, covering wines,9 spirits,10 agriculture and foodstuffs. For the latter two types of product, which are the most relevant ones to the discussion here, the European Union currently has two legal instruments in effect:
1. Council Regulation (EC) No 510/2006 of 20 March 2006 on the protection of geographical indications and designations of origin for agricultural products and foodstuffs.
Under these Regulations, Europe has three types of registered GI. These are protected designations of origin (PDOs), protected geographical indications (PGIs), and traditional specialities guaranteed (TSGs). It is worthwhile to look at these in some detail because despite Europe’s relative wealth and longer experience in the use of GIs, their objectives appear on the face of it to be consistent with those that small-scale producers in developing countries might also consider relevant and important. Thus, the preamble of Regulation 510/2006 notes that: ‘The promotion of products having certain characteristics can be of considerable benefit to the rural economy, particularly in less-favoured or remote areas, by improving the incomes of farmers and by retaining the rural population in these areas.’
Article 2 of the same Regulation provides definitions of PDOs and PGIs. A PDO is:
the name of a region, a specific place or, in exceptional cases, a country, used to describe an agricultural product or a foodstuff:
—originating in that region, specific place or country,
—the quality or characteristics of which are essentially or exclusively due to a particular geographical environment with its inherent natural and human factors, and
—the production, processing and preparation of which take place in the defined geographical area;
A PGI means:
the name of a region, a specific place or, in exceptional cases, a country, used to describe an agricultural product or a foodstuff:
—originating in that region, specific place or country, and
—which possesses a specific quality, reputation or other characteristics attributable to that geographical origin, and
—the production and/or processing and/or preparation of which take place in the defined geographical area.
The definitions are similar, but we can see that the requirements for a PDO are somewhat more stringent in two senses. First, the geographical environment with its natural and human factors is more or less wholly responsible for the product or foodstuff’s positive features. PGIs also place a lot of emphasis on geography, but it is mere place-origin that counts rather than any special environmental and human factors. Moreover, the responsibility of geography for the specialness of the product is expressed in less absolute terms: ‘attributable to’ rather than ‘essentially or exclusively due to’. Second, PDOs require that production, processing and preparation of the product all take place in the geographical area, while PGIs require that at least one of these be carried out in the area. Like patents and trademarks, PDOs and PGIs must be registered. The Regulation explains the procedures for this.
It is possible to oppose any indication. However, when governments forward applications to the Commission, they tend to be registered whether or not they are particularly rigorously prepared or indeed whether they necessarily stand up to serious critical examination. Some controversial indications have been registered and even survived litigation when many objective observers would not have expected such an outcome (see box).
Box 9.1 PDOs and PGIs in Europe: Some (possibly anomalous) examples
A Protected Designation of Origin: Feta Cheese
Feta is a white cheese stored in brine and made from sheep’s milk or a mix of sheep’s and goat’s milk from local breeds and made using traditional methods. It was registered in 2002 as a cheese made in certain areas of Greece. As is often the case with GIs, the product has for quite some time been produced elsewhere. The question then arises as to whether it is fair to grant a GI when a reasonably objective case could be made for its having become a generic term for damp salty, white sheep or goat milk cheese, and that the public was not misled into thinking that non-Greek feta is really Greek. Nonetheless, in 2005, the Court of Justice of the European Union, perhaps mistakenly, ruled it illegal for any cheese produced outside Greece to be called ‘feta’, despite the fact that in Denmark, Germany and France locally made cheeses with the word ‘feta’ in the name had been sold for several decades. Feta is not in fact the name of a place but is the Greek word for ‘slice’.*
A Protected Geographical Indication: Cornish Pasty
A pasty is a type of meat and vegetable pie commonly associated with the English county of Cornwall, which is one of the poorest parts of the country suffering from the consequences of the closing down of its mining industry and cultural erosion including loss of its own language. In 2011 ‘Cornish pasty’ was granted PGI status recognizing it as an important aspect of the county’s ‘culinary heritage’, and acknowledging also that (i) the general public tends to associate pasties with Cornwall and (ii) that pasty making does seem to be taken quite seriously there as compared to other parts of England where they were also made. On the other hand, ‘Cornish’ pasties have been produced outside the county for a very long time and there is no particular reason to suppose that making them in Cornwall and from ingredients sourced within the county results in a product that is different in quality or in any other way from pasties made elsewhere. After all, it is not regarded as a particularly high-quality product and no special skill is required to make them. Indeed, there is some documentary evidence to suggest that pasties originate not from Cornwall but the neighbouring county of Devon.** Despite this, all existing producers outside Cornwall must either cease their use of the indication or have by request been granted a 3-year phase-out period. They can, of course, continue to call their products pasties; they just have to discontinue using the word ‘Cornish’.
* Judgment of the Court (Grand Chamber) of 25 October 2005. Federal Republic of Germany (C-465/02) and Kingdom of Denmark (C-466/02) v Commission of the European Communities. Joined cases C-465/02 and C-466/02. European Court reports 2005, p. I-09115.
** BBC. 2006. Devon Invented the Cornish Pasty. BBC News [Online]. Available at: http://news.bbc.co.uk/1/hi/england/cornwall/6144460.stm [accessed: 9 January 2013].
The Traditional Speciality Guaranteed mark is for products that are traditional in the sense of being used ‘on the Community market for a time period showing transmission between generations; this time period should be the one generally ascribed to one human generation, at least 25 years’. It is not necessary that they be produced in a particular area. This feature makes TSGs rather interesting. After all, many indigenous peoples have been forced to inhabit areas other than their original territories yet traditional products continue to be made. Two European examples of TSG products are Traditionally Farmed Gloucestershire Old Spots Pork and Pizza Napoletana. These two names can be used by producers anywhere in Europe: there is no requirement to produce only in Gloucestershire or Naples; but only those products produced according to the specifications laid out by the TSG can actually use the mark. In the former case, the TSG is controlled by the Gloucestershire Old Spots Pig Breeders Club. As for the latter, two associations in the city of Naples applied for the TSG, with three organizations made responsible for verifying compliance with the specification. It is worth noting that the Regulations provide two alternatives: either the name of the product can be used by third parties without authorization from the holders of the TSG; or else use of the name is reserved to producers granted permission from the holder. But in both cases, the TSG sign can only be used by authorized producers.
In describing any type of IP, it is essential to go beyond the subject matter and consider the scope of the rights: what acts by third parties are right holders, permitted users or other interested parties entitled to prevent? Article 13.1 (Protection) of Regulation 510/2006 protects against the following acts:
a. any direct or indirect commercial use of a registered name in respect of products not covered by the registration in so far as those products are comparable to the products registered under that name or in so far as using the name exploits the reputation of the protected name;
c. any other false or misleading indication as to the provenance, origin, nature or essential qualities of the product, on the inner or outer packaging, advertising material or documents relating to the product concerned, and the packing of the product in a container liable to convey a false impression as to its origin;
d. any other practice liable to mislead the consumer as to the true origin of the product.
Similar but less detailed language can be found in Article 17 of Regulation 509/2006 on Traditional Specialities Guaranteed, although it is not necessary that the name itself be protected: exclusivity is only in reference to the TSG symbol or the ‘traditional specialities guaranteed’ phrase. It depends on whether the producer group concerned has requested that the name of the product be reserved. For this request to be granted, Article 13 stipulates that the name must not already be ‘used in a lawful, renowned and economically significant manner for similar agricultural products or foodstuffs’.
It should be clarified that, notwithstanding the feta case suggesting otherwise, when a once-local product becomes generic it can no longer be protected. This has been the fate of such products named after places as Cheddar cheese and Dijon mustard, which can now be produced anywhere. One would suppose that once a product becomes generic there is no going back. And yet reclaiming the indication may not be totally impossible. A partial re-localization has been achieved, for example, with Cheddar cheese. There is now a PDO on ‘West Country Farmhouse Cheddar’. However, the permitted area of production is far larger than the village of Cheddar.
Moreover, with political will and sympathetic courts, products that supposedly have become generic in some territories can sometimes be re-localized outside and within the jurisdiction. This has been the case for sherry, a fortified wine named by linguistically challenged English people after a district of Spain called Jerez.11 ‘Cyprus sherry’, sold under that name since the 1930s, has thus been renamed ‘Cyprus fortified wine’. The naming of South African fortified wines as sherry and port had to be phased out under the terms of the 1999 EU–South Africa free trade agreement,12 according to which all exporting under those names had to cease within eight years, with domestic sale having to end within 12 years.13 Another good example is the aforementioned feta cheese.
Practical Aspects of GIs in Developing Countries
Evidently, a substantial majority of European Union GIs do come from relatively poor areas of Europe. Given the premium prices achieved by the more successful indications, it may indeed reasonably be asserted that ‘GIs have the potential to generate value-added products for farmers in depressed areas’.14 A frequently cited example is Comte cheese from the French Jura mountain region. When protected as a GI in 1993 ‘the cheese enjoyed a 20% price differential over Emmenthal produced in Switzerland which is not GI protected. By 2003 this had risen to 46% and production of Comte had risen by 3% a year’.15
What of developing countries? The vast majority (about 90 per cent) of GIs are from the OECD countries. Consequently, developing country experiences are quite limited. But this is not to say these countries have been completely inactive. Indeed, Chile protected the grape brandy product ‘Pisco’ (see below) as early as 1943, requiring the name be reserved ‘for an “eau de vie” produced in a certain region of the country’.16 Several developing countries are parties to the 1958 Lisbon Agreement for the Protection of Appellations of Origin and their International Registration. Of these, six have registered appellations.17 Obviously this is not a large number of countries. In 1999, India passed legislation (see box),18