Sunday, May 10, 2020

GIs - the EU v US positions and the SEA battlefield

What is a Geographical Indication and how it is different from ...

The EU and US do not see eye to eye on GI protection. Until now the non agreement hasn’t been contentious, but the 2020 USTR Special 301 report just released raises the temperature. It argues that the EU position “significantly undermines the scope of trademarks and other IP rights held by U.S. producers”.

The US does not protect GIs specifically, but allows them in practice as certification marks unless they are generic terms and provides some protection to wines through the American Viticultural Area (AVA). However many terms are generic in the US due to the historic immigrant use from the places in question. For example Italian immigrants widely used ‘Parmesan’ in the US rendering it generic in the US for that type of cheese. Meanwhile the EU has a huge GI industry (estimated at E25 million in value in 2014). There are 2 levels of GI protection – Protected Designation of Origin and Protected Geographical Indication. Above this the TRIPS rules protect GIs, with additional protection for wines and spirits, but allow non confusing uses in certain circumstances. The EU and US don’t agree on what constitutes non confusing use.

In SE Asia most countries now have sui generis GI laws. But as in many other markets, a battle is being played out as the US and EU increasingly negotiate IP protections at a bilateral level. EU FTAs with IP chapters propose extensive GI protection. This sits well in economies with strong agri sectors.

Thailand has rapidly built a national GI portfolio of agricultural and non-agricultural products (i.e. handicrafts) – 118 domestic GIs are now registered. It also has 6 foreign GI products registrations from Thung Kula Rong Hai hom mali rice in the EU to Lamphun brocade Thai silk in Indonesia. A series of other Thai GIs are still at application stage,  from Phetchabun sweet tamarind in Vietnam to Doi Tung coffee in Cambodia. Thailand is committed to developing and promoting more GIs from all of its provinces to generate income for communities. It aims to hit a billion dollars in GI based trade in the next 5 years. 

Vietnam has signed an EU FTA (which is awaiting ratification after which they will automatically protect each other's GIs) and is also known to be keen to develop more GIs.  Indonesia has filed one GI in the EU for Kopi Gaya coffee and is trying to develop more domestic GIs.

Meanwhile the US seeks to insist in its negotiations that GI protection must not override legacy trademark rights. Some GI names are incorporated into US trademarks and their export capability is diminished in third countries if GI protection is too strong. The EU typically conditions an FTA to provide mass reciprocal mutual GI recognition. The EU also requests extensive unfair competition type protection against any misleading uses.  The US goes on to argue there is inconsistency in the EU position (notably some exceptions, where some EU countries use others’ GIs as descriptors).

It is unclear how SE Asian countries should approach this, whether to offer wide and reciprocal protection to the EU (therefore enabling EU market access for their GIs), or whether to carve out exceptions for US brands (e.g. California Champagne). So far few of the US trademarks at issue seem to have reached disputes in the region but that will change over time. Thailand clearly intends to use GIs to support its agri and handicrafts sector, and countries with large agri sectors will presumably do the same; which could create a market access barrier to some US brands.


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