WINES AND SPIRITS IN THE REALM OF GEOGRAPHICAL INDICATIONS (GIs)
Most of the times the quality of certain goods such as agricultural produce, foods and spirits, are valued by customers primarily because of the exceptional natural conditions of their region or country of origin, or because of their traditional production methods. The quality of such products can be gauged from its geographical place of origin and manufacture. Geographical indications (GIs) are the names assigned to places used to recognise products which have such ascription to the place of origin and manufacture (for example, “Tequila”, “Scotch whisky”, “Roquefort”, “Polish Cherry” or “Champagne”). A Geographical Indication tag undoubtedly increases the appeal of such goods and distinguishes it from others offered on the market.
On the world scale these are modulated by the World Trade Organization Agreement on Trade-Related Aspects of Intellectual Property Rights2 and in India we have the Geographical Indications of Goods (Registration and Protection) Act, 1999, respectively, to manage and regulate the Geographical Indication tags. One of the significant reasons as to why the Geographical Indication tags have cumulated interest from countries across the world is their potential to be a powerful marketing tool. This not only speeds up the exports promoting economic growth but also concurrently preserves the cultural heritage of a country.
With respect to alcoholic beverages, Agreement on Trade-Related Aspects of Intellectual Property Rights provides for additional protection at two levels. As enshrined in Article 22 of this agreement, the first is the basic level or a minimal standard of protection where all geographical indications must be protected against use which would mislead the public or constitute an act of unfair competition.
The second is a higher standard of protection specifically for wines and spirits provided for in Article 23 of Agreement on Trade-Related Aspects of Intellectual Property Rights. In the special case of wines and spirits, Article 23.1 of Agreement on Trade-Related Aspects of Intellectual Property Rights prohibits the use of translations of geographical indications or attachment of expressions such as ‘kind’, ‘type’, ‘style’, ‘imitation’ to products not originating from the place indicated, even where the true origin is clearly indicated. Thus, ‘Champagne style sparkling wine, made in the USA would be prohibited even though this is clearly not deceptive.3 Another example of the same would be to refer to a product as “Scottish-type whisky” or “Scotch whisky flavour drink” when it is not whisky from Scotland, since it would be deceptive in nature.
The scope and significance of Geographical Indications is evinced through the nature of protection accorded to them. In 2009, a trademark application “Lambrusco dell’Emilia Canottieri” was filed before the Spanish Trademark and Patent Office (OEPM) in relation to wines falling in the international class 33. Although the trade mark did not entirely reproduce the protected denominations, its registration would have been in conflict with the earlier protected designation of origin ( PDOs) . Indeed, the scope of protection of a GI is not limited to the exact reproduction of the protected geographical name but it also prevents its partial reproduction and the use of names directly or indirectly evoking the denomination. Furthermore, the applicant was not a producer respecting the relevant PDO specifications and, as a consequence, he was not entitled to use the denomination in a label.
POSITION IN INDIA
The Scotch Whisky Association (“SWA”) a UK based organization that works for the advancement of global interests and profile of Scotch Whisky filed a case in the Delhi High Court in 20064. It filed a case against Golden Bottling Limited for manufacturing a “Red Scot” whisky alleging that the name of the whisky gave the consumers the impression that the whisky originated in Scotland and that it was in fact the real Scotch Whisky. The court, after analysing the definition of “Scotch Whisky” under the UK Scotch Whisky, Act, 1988 and Rule 3 of the Scotch Whisky Order, 1990 agreed that Scotch Whisky was a Geographical Indication. Since, Scotch Whisky was not registered as a GI in India back then, the court was unable to uphold the Geographical Indication tag. The court relying on Section 20(1) of the Indian GI Act, 1999, which prohibits any person from instituting any proceedings to prevent or to recover damages for the infringement of an unregistered Geographical Indication, held the Defendant guilty only of the tort of passing off. Further the court restrained the Defendant from using “Scot” or “Scotch” to market its products. Subsequently, the Government of India, vide a 2010 notification, recognized Scotch Whisky as a Geographical Indication.
As of today, foreign liquor varieties having the Geographical Indication recognition in India includes the “Peruvian Pisco” (2009), “France’s Champagne” (2010), “Napa Valley wine of the United States of America” (2010), “UK’s Scotch Whisky” (2010), “Cognac of France” (2011), “Porto of Portugal” (2011), “Douro wine of Portugal” (2011), “Tequila of Mexico” (2012), “Presecco of Italy” (2016), and “Irish Whiskey” (2019). Similarly, the Indian alcoholic beverages with Geographical Indication tag are “Feni of Goa (2009)”; “Nashik Valley wine of Maharashtra (2010)”; “Judima rice wine of Assam” is still awaiting the final registration.
India has metamorphosed into a lucrative hub for the global alcohol industry. The spurge of popular European wine brands are making a beeline for geographical indication (GI) registration in India is a testimony to the growth of the Indian consumer landscape for niche wines and spirits. The proposed deduction of import duty in India on wines and spirits as a part of negotiations under the free trade agreement with the European Union has also led to a greater interest of wine companies in the Indian market Owing to the unprecedented applications by wine producing giants across the globe , foreign products now outnumber Indian brands in requests for GI registration in India. It is quite interesting that out of the 227 applications pending registration before the GI Registry office, 125 are from European Union by wine and spirits brands. Hence, it is evident that the growing potential of the Indian wine market, which logs an annual growth of 20-30 %, is luring European wine brands.
The list of European wine brands seeking GI registration has some popular ones like Bordeaux and Burgundy from France, Manzanilla and Cava from Spain, Rheinhessen and Mittelrhein from Germany , Montepulciano d’Abruzzo and Chianti from Italy, Retsina of Attiki of Greece Tokaj of Hungary and Commandaria of Cyprus.
It is clear from the Court of Justice of the European Union’s judgment that the protection of Geographical Indications is important for brand owners, the market and consumers. However, the answers given by the Court of Justice of the European Union do, to a certain extent, limit the ability of holders of Geographical Indications to enforce their rights against third parties using an indication which, while not identical or similar, alludes to the Geographical Indication or the country to which that indication relates.
Despite this limitation, the enterprises should bear in mind that protection of geographical indications is quite broad. They are protected not only in the case of direct or indirect use to refer to unprotected products, but also with respect to many other practices such as improper exploitation or allusion, as well as false or misleading indications of place of origin, properties or characteristics that could create a false impression as to the origin of the product.
1 ‘Agreement on Trade-Related Aspects of Intellectual Property Rights’, WTO, https://www.wto.org/english/docs_e/legal_e/27-trips.pdf.
4 Khoday Distilleries Limited v. The Scotch Whisky Association and others, Appeal (civil) 4179 of 2008.
The article was originally published on www.lexology.com on April 03, 2020 and can be accessed here.