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WTO rules on EU regional trade mark policy dispute


Both sides have claimed victory in a dispute before the World Trade Organisation ( WTO ) over Europe's policy of recognising regional trade marks only from non- EU countries that have trade mark protections equivalent to those found in the EU .

Regional trade marks, such as Champagne, Parma Ham or even Florida Oranges, relate to products that are connected with a particular territory. These are geographical indications that, unlike normal trade marks, are not an exclusive individual right, but are available to any producer in the region concerned. As such, the EU gives them special protection.

But in 2003 the US and Australia filed separate complaints with the WTO over what they see as the EU's discriminatory approach to geographical indications, alleging that the EU does not allow the geographical indications of other WTO members to be registered, and protected, in the EU unless that other member provides the same protections as the EU.

This, the Office of the United States Trade Representative explained at the time, is inconsistent with national treatment and most favoured nation obligations under international trade agreements, as it allows the EU to treat imported products in a less favourable manner than EU products.

The WTO set up a dispute settlement panel to investigate the complaint in October 2003, and yesterday that panel issued its report, upholding the EU system of geographical indications, but extending its rights to non-EU states.

The ruling has both sides claiming victory.

According to the European Commission, the report upholds the integrity of the EU system and rejects the majority of the claims made by the United States and Australia.

The panel upholds an important element of the EU system, said the Commission: the requirement for inspection structures to verify that the conditions for each geographical indication are fulfilled in order to benefit from the high level of protection against unlawful use.

The panel also confirmed that the provision of the EU system allowing for the 'coexistence' of geographical indications with prior trade marks under certain circumstances is fully justified under the TRIPS (Trade-Related Aspects of Intellectual Property Rights) Agreement, said the Commission.

"By confirming that geographical indications are both legal and compatible with existing trade mark systems, this WTO decision will help the EU to ensure wider recognition of geographical indications and protection of regional and local product identities," said Peter Mandelson, Commissioner for Trade.

But the panel report also asked the EU to clarify its rules in respect of applications for registration of geographical indications from third countries.

According to the Office of the United States Trade Representative, the WTO panel agreed that the European system discriminates against US products and producers and is therefore contrary to WTO rules.

The panel also agreed with the United States that Europe could not, consistent with WTO rules, deny US trade mark owners their rights, stating that any exceptions to trade mark rights for the use of registered geographical indications were narrow, and, for instance, limited to the actual geographical indication name as registered.

"We're very pleased with this decision," said the Acting US Trade Representative Peter F Allgeier. "It's a clear win for American farmers and food processors."

According to the BBC, the Australian mission to the WTO has also welcomed the report, adding, "It is rare in WTO disputes for either party to win on all claims".

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