Geographical Indication

The Lisbon Agreement : Why the GI cum Trademark System may work to its own detriment(Part II)


(This post is Part II of a two part series, where I discuss the trademark system adopted for protection of GIs in a number of countries )

Historically, there has really been no uniform approach to GI protection. That the WIPO Lisbon Treaty Negotiations at Geneva remains closed to non-member states is a major source of worry to countries like the USA, Australia and Canada for fear that the revised agreement may fail to consider and include within its ambit the divergent approaches to protection of GI, thereby affecting the countries’ own producers.

The three countries in addition to various others allow for protection of geographical indications by employing the existing trademark structures already in place and registering geographical indications either under certification marks or collective marks.

1. Collective marks are those marks used by associations, unions, cooperatives, fraternal organizations, or other organized collective groups.

 

The difference between the two types of collective marks was explained by the Trademark Trial and Appeal Board (TTAB) in Aloe Creme Laboratories, Inc. v. American Society for Aesthetic Plastic Surgery, Inc., 192 USPQ 170, 173 (TTAB 1976).

Collective trademark/ collective service mark is a mark adopted and used by a ‘collective’, aimed at enabling members of such a collective to, through the use of the mark, distinguish their goods from the goods of producers outside of the concerned collective. The collective itself does not sell goods, but promotes the products through advertising for the benefit of individual members.

A collective membership mark, on the other hand, is a mark adopted by an organized collective like a union or an organisation, without any intention by members to distinguish goods from those of other producers in the market, but simply to indicate that the producer is a member of the said collective.

Collective trademarks as well as collective membership marks work just the same way as normal trademarks do, by pointing to the commercial origin of a product. The only difference is that with collective marks, the intention is to indicate origin in a group or collective, and the individual producer. Further, since the one mark is used by all the members within the group, no one person can ‘own’ the mark per se – the group collectively holds the mark for the benefit of the members in the group.

2. “A certification mark is any word, name, symbol, or device used by a party or parties other than the owner of the mark to certify some aspect of the third parties’ goods and services”.

 

The purpose of a certification mark is essentially to indicate to the consumer that the product possesses certain characteristics and meets certain verifiable standards.  The owner of a certification mark is most often the government itself, or an organization operating with the government’s permission because of the associated responsibilities concerning prevention the unauthorized use and exploitation of the mark and ensuring compliance with the qualifications laid down, especially where the use of a GI as a collective mark is concerned. As the owner, the government/ authorized organization exercises control over the use of the mark, but does not use the mark itself. All producers meeting the stated standards are permitted to employ the use of the mark, the mark thus acting as a certification of quality for the product.

Geographic names that otherwise cannot be registered as trademarks on account of being geographically descriptive can be registered  as certification marks, and this, without showing the “acquired distinctiveness” requirement as in the case of trademarks. “IDAHO” potatoes for instance, has been registered as a certification mark.

3. GIs as trademarks

Under the present US law, geographic signs or names cannot be registered as trademarks if they are considered to be geographically descriptive or “likely to cause confusion, mistake or deception” – compliant with the Article 22(2) of the TRIPS Agreement, requiring members to ensure that the use of the GI is not made in a misleading manner, or in a manner that constitutes an act of unfair competition – with regard to the source of the goods in the minds of the consumers.  However, where the sign is such that consumers have come to associate a secondary meaning to it, thereby according to it a source identifying capacity, the geographical indication may be registered as a trademark as well.

 

It is interesting to note that until the enactment of the Geographical Indication of Goods (Registration and Protection) Act, 1999 (which came into force on September 15, 2003), GIs in India were only protected as certification marks under the Trade and Merchandise Marks Act, 1958. Under the Trade and Merchandise Marks Act, 1958, infringement of a GI under a certification mark was dealt with only a passing off action, where it was necessary to be proved that the infringer had deliberately tried to sell its product riding on the reputation of a particular product. However, success was not always guaranteed, as in the Khoday Khoday India Limited vs The Scotch Whisky Association and others case, which we had earlier reported here.

The government, realizing the insufficient protection offered to producers so far as prevention of misappropriation of the GI is concerned, and the unexploited scope to fetch premium prices, under the Act, later on brought in a sui generis legislation to protect GIs – an important step taken towards realizing the economic potential of GI-protected products.

Overlapping systems hampering free trade?

Article 24(5) of the TRIPS Agreement states that the “eligibility for or the validity of the registration of a trademark, or the right to use a trademark” will remain unaffected where a trademark has been acquired in good faith before 1994 or before the GI was protected in the country of origin. The Italian Parma ham, for instance, cannot be sold under its name in Canada or Mexico because the name was already trademarked in the two countries – the result of not having an exclusive system for protection of GIs – and this is one of the major reasons why US’ current system of registering geographical indications may very well work against it, considering the closer door negotiations that are being carried out for the revision of the Lisbon Agreement.

The creation of a single system for registration of geographical indications as well as trademarks has created a rather unfavourable trading scenario in the USA for producers outside – the presence of a trademark, for instance, bearing the geographical name of a place prevents producers belonging to that region from gaining access to the market even though their product is legitimately identified by a GI, and simply on account of the pre-existing trademark in the USA, based on the “first in time, first in right” rule. This essentially leaves producers outside of USA with only two options – either to apply for cancellation of the trademark or enter into negotiation with the owner to purchase it. Both methods are extremely costly and at the same time not always successful, making them both unfeasible options for small producers, despite being owners of famous GI cheeses, wines, tea etc.

Further, adoption of a global, standardised system for GIs may not be in the favour of US corporations, many of whom use geographical names of European places for their products (the result of massive European immigration in the USA), because under US law, geographical names are considered to be generic and available for use by any producer. Unlike the USA, Europe has adopted a sui generis GI protection system, and thereby, products here are protected by GIs on the basis of its source of origin – leading to a conflict between European GIs and US trademarks. For instance, Budvar is the Czech name for the town of Budweis in the Czech Republic, after which the US beer brand Budweiser was named, which is trademarked in the USA – leading to a conflict between the American Budweiser owner,  Anheuser-Busch and Budjovick’ Budvar, the Czech manufacturer of the ‘Budvar’ beer brand. At the same time, it’s rather pertinent to note that a large part of Europe recognized Budvar’s exclusive rights to beer from Budweis, and in such countries the American Budweiser is forced to market itself as only ‘Bud’. European law holds that a trademark owner’s rights cannot be prioritised over a GI obtained earlier and in good faith. Under the protected geographical indicators (PGIs) concept adopted by most countries in Europe, both “Budweiser Beer” and “České Budějovice Beer” are considered to be PGIs and only products, where products indicating a link to a certain are must have “at least one of the stages of production, processing or preparation” in that area – leading to the cancellation of the trademark rights of the American Budweiser in those European nations.

India along with the European Union, Jamaica, Kenya, Bulgaria and others are those In favour of stronger protection for GIs. India for instance, after having fought multiple cases against Darjeeling tea imposters, was the first Indian product to be conferred with the PGI status by The European Trade Council and the German Tea Association, thereby ensuring that no producer can mix Darjeeling tea with any other type of tea and thereby sell it as ‘Darjeeling Tea’ ; only packets containing 100% Darjeeling Tea with the Darjeeling Tea and PGI logo labelled on them can be branded and marketed as Darjeeling Tea.

So far as the amendment of the Lisbon Agreement is concerned, the US in its submission to the Lisbon Negotiations at Geneva currently underway, it affirms its belief in the need for an open diplomatic conference that produces a GI system that is the product of global consensus, fulfilling three fundamental principles of 1) territoriality 2) due process and 3) GI as private rights, which it discusses in detail here. It essentially emphasizes that each WIPO member must be allowed to make its own determination as to devising a system of protection it deems most suitable so as to establish whether a GI is considered legitimate or invalid in its own territory. Further, because GIs are private property rights, it believes that each member country should adopt a financial self-sustaining mechanism instead of depending on other WIPO members and revenue generated by other WIPO registration systems.

As the negotiations are currently underway, it seems rather difficult to predict what the final draft is going to look like, but there’s hope that it takes into account the legal mechanisms catering to geographical indications in all the different WIPO member states before declaring the final verdict.

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Kiran George

Kiran Mary George is a Third Year student at ILS Law College, Pune. Her first stint in the world of Intellectual Property law was an internship with a registered copyright society that granted her an insight into the world of copyright in music. Since then, her interest in IPR has taken strong hold, and she enjoys keeping close tabs on developments in the field. She is still discovering her interests, but so far takes a special liking to open access, copyright and trademarks.

One comment.

  1. AvatarArvind

    can you tell me how does it affect india ?? or let me phrase my question how does it affect developing countries ?

    Reply

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