European Parliament approves Regulation for Non-Agri Geographical Indications

Yesterday, the European Parliament adopted the Regulation on geographical indication (GI) protection for craft and industrial products, also known as non-agri GIs. This will create a new, EU-wide system of sui generis GI protection for products such as ceramics or knives. The adopted text is available here.

 
Up until now, only wine, spirit drinks and agricultural products could benefit from EU-wide GI protection. In turn, crafts and industrial products are protected by EU Member States on the basis of national legislation, including national GI rights and collective marks.

The Commission’s proposal for non-agri Regulation was published in Spring 2022, along with a parallel proposal to reform the GI system for wine, spirit drinks and agricultural products.

A PGI-like scheme

According to art. 6, crafts and industrial products will be protected under a system equivalent to protected geographical indications (PGI), instead of protected designations of origin (PDO). That is, the protection will be based on the product’s quality or reputation, not its connection to the soil, climate and human elements (also known as terroir).

Crafts and industrial products will use the same PGI logo as alcoholic drinks and agricultural products (art. 44). This norm was opposed by GI associations, which believe that this would dilute the “power” of the PGI logo for alcoholic drinks and agricultural products. This is because crafts and industrial products are subject to less strict controls: producers will only need to issue a self-declaration of compliance with the specification requirements (art. 4(8)).

A two-phase registration

The registration procedure will consist of two phases (art. 7). First, a national body (such as a national IP office) will process the GI application at the national phase. This includes a national examination, as well as a national opposition procedure (arts. 12-15). The ensuing national decision may be challenged before national courts (art. 16(3)).

EU Member States (especially those that expect having few GIs) may derogate from the national phase: the application will then be submitted directly to the Union phase. GI applications from third countries are also submitted directly (art. 20).

One of the Regulation’s main novelties is that the European Union Intellectual Property Office (EUIPO) will be responsible for the Union phase of the examination. For alcoholic drinks and agricultural products, the European Commission is currently competent for this phase.

The decision to grant EUIPO competences in non-agri GIs was met with criticism among certain stakeholders (it was later somehow eclipsed by the Proposal on standard essential patents which may also end up among the EUIPO competences). The EUIPO’s role may be reinforced even further, considering a recent ruling of the Court of Justice on agricultural GIs: it states that the European Commission is not bound by the national examination results when evaluating the GI application at the Union phase.

Nevertheless, some GI lawyers actually praised this new institutional set-up in conversations with this Kat: the Regulation brings much-awaited procedural guarantees, including EU-wide oppositions and strict deadlines for every step. Moreover, knowing how the EUIPO functions, we may expect detailed GI Guidelines that will also bring harmonisation in examination.

At the EUIPO, the applications will be examined by the soon-to-be-created GI Division (art. 23). Its decision could be appealed to the EUIPO’s Boards of Appeal (art. 33), which may be followed by an action to the General Court, then to the Court of Justice.

The GI Division and the Boards of Appeal may consult the Advisory Board on issues such as examination or generic nature of the GI (art. 35). The Advisory Board shall be composed of one representative of each MS and one representative of the Commission. Where necessary, recognised GI experts, including representatives of regions and academia, may be invited to provide expertise to the Advisory Board (art. 35(5)).

Scope of protection

Another important novelty of the Regulation is that the scope of protection for GIs is expanded (with equivalent provisions being included in the parallel proposal for alcoholic drinks and agricultural products).

In its original Proposal, the Commission tried to address the issues that arose with the interpretation of the notion of “evocation”, by providing a specific definition. The original definition was based on the Court of Justice’s jurisprudence, but also required a harm to the GI reputation. This element was briefly mentioned by the Court of Justice in Champanillo, but it does not seem to be an established requirement at the moment.

Requiring a harm to reputation in the assessment of evocation would help fighting with the over-expansion of this protection standard. Unfortunately, the final text is less bold and defines evocation as a situation “in particular, where a sufficiently direct and clear link with the product covered by the registered geographical indication is created in the mind of the average European consumer who is reasonably well-informed and reasonably observant and circumspect” (art. 40(2)). The “in particular” part will surely open way for further preliminary rulings on the topic.

Following the trade mark reform and similar initiative in the design proposal, GI owners will also be allowed to exercise their rights over goods in transit (art. 40(4)). The scope of protection is extended to any use in a domain name that is contrary to the protection standards set in art. 40(1). GIs may be invoked in any disputes in front of the country-code top-level domain name registers, established in the European Union (art. 46).

Next steps

The text must now be formally approved by Council. It will enter into force twenty days after its publication in the Official Journal. The new system will be applicable two years after that date.