EU-US Wine Agreement May Signal the Future of Geographic Indicators

On September 15, 2005, U.S. Trade Representative Rob Portman announced that the United States and the European Community reached agreement on wine-making practices and labeling of wine. Among other things, the agreement provides for the United States limiting use of certain “semi-generic” terms in the U.S. market; the EU allowing use of certain regulated terms on U.S. wine exported to the EU; and each recognizing certain names of origin in each other’s market.

According to the U.S. press release, "The Agreement does not address the use of 'geographical indications,' a form of intellectual property." However, BRIDGES Weekly Trade News Digest noted on September 21 that semi-generic terms have been at the core of the larger dispute over whether certain "names of origin" can be used for products not originating from the region in question:

The pact therefore sets a precedent for product-based GI recognition among the
WTO's two most powerful Members. This approach could spill over into their
negotiating positions in the WTO. There, it would run up against developing
countries,which have been pushing for a rule-based solution for recognising and
registering GIs under the TRIPS Agreement given their concern that a
product-based approach -- especially one limited to wine -- would not adequately
cover their own geographically-based food and handicraft products.

Since the EU and the US are among the world's biggest wine producers, theirdeal may motivate other producers such as Australia, Argentina, South Africaand Chile to seek similar protection for their wines in the WTO. In thismanner, a product-based list could emerge as the basis for WTO negotiations.This would require developing countries to develop product lists of theirown in order to benefit from GI protection.

The press release from the European Union noted that a second-phase of negotiations "will start ninety days after the date of entry into force of the agreement and will, among other things, include a dialogue on geographical indications (GIs), a dialogue on the matter of names of origin including the future of the semi-generic terms, a dialogue on the use of traditional expressions, low alcohol wines, certification, wine-making practices and the creation of a joint committee on wine issues."

California vintners applauded the bilateral deal for smoothing rough spots in the market for exports to Europe. European winemakers also toasted the new commitment to protection of their names. More on the agreement is available from the INTA here.

However, according to William New writing for Intellectual Property Watch on September 23, 2005, a September 16, 2005 meeting of the World Trade Organization committee responsible for intellectual property rights saw little progress on the issue of a creating a multilateral registration system for geographical indications of wines and spirits under Article 23.4 of TRIPS. Nonetheless, the meeting dis produce a new paper from the WTO secretariat comparing three proposals from Hong Kong (TN/IP/W/8), the European Union (TN/IP/W/11), and a joint proposal from Argentina, Australia, Canada, Chile, Dominican Republic, Ecuador, El Salvador, Guatemala, Honduras, Japan, Mexico, New Zealand, Taiwan and the United States (TN/IP/W/10). The main differences between these positions appeara to be whether GI registration should be mandatory. Europe would like to amend the TRIPS Agreement and make registration mandatory. The joint proposal would not amend TRIPS and would make registration voluntary by encouraging the use of a database of registered items. The Hong Kong proposal falls between, providing some protection for registered items across all members who choose to participate.

A separate effort is reportedly underway at the WTO to extend that GI protection to other products.