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27 February 2006
The year 2006 marks the 250th anniversary of the creation of one of the oldest geographical indications for wines, the Região Demarcada do Douro, which is associated with the production of the world-famous port wine. However, the past few years have brought problems for those who advocate strong protection of geographical indications and other traditional terms used to identify certain goods.
Geographical indications are recognized internationally, notably in Section 3 of the Trade-Related Aspects of Intellectual Property Rights (TRIPs) agreement. However, trade practices have led to the use of certain other terms to identify products which already have a geographical indication, as in the case of port wine, which used to have an exclusive right to terms such as 'ruby', 'tawny' and 'vintage'.
Within the European Union, this exclusive right was guaranteed by EU Regulation 753/2002. However, this regulation was strongly criticized by the World Trade Organization and was amended in 2004 to allow the use of certain traditional terms in connection with products other than those with which they have traditionally been associated.
The law clearly allows for the wider use of such traditional terms; the European Commission has already entered into agreements with the United States and South Africa which widen the scope of use of certain terms usually associated with wines produced in EU countries. Australia recently submitted a request for a similar agreement.
Trade-related IP rights such as trademarks and geographical indications must be considered from two points of view. They not only help to protect products that stand out from the competition, thus encouraging the production of quality goods and rewarding investment by producers, but also indicate that the products meet standards or offer certain qualities which consumers have come to expect from products bearing a given trademark or indication of origin. This consumer-oriented consideration is set out in Recital 54 of EU Regulation 1493/1999.
The use of certain traditional terms in connection with wines other than those usually associated with them poses a clear threat from both points of view. It will contribute to greater confusion between wines of different quality, to the detriment of both producers which invest in making quality wine and consumers, who may purchase a product that, because of its misleading labelling, does not meet their expectations.
Although the rules in this area of the international wine trade seem clear, the question remains whether they offer sufficient protection to the parties involved, notably producers and consumers, or whether they are simply a compromise dictated by international trade policies.
For further information on this topic please contact César Bessa Monteiro at Abreu Cardigos & Associados by telephone (+351 21 7231800) or by fax (+ 351 21 7231899) or by email (email@example.com).
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César Bessa Monteiro