A geographical indication (GI) is a name or sign used on certain products which corresponds to a specific geographical location or origin (e.g. a town, region, or country). The use of a GI may act as a certification that the product possesses certain qualities, is made according to traditional methods, or enjoys a certain reputation, due to its geographical origin.
Governments have been protecting trade names and trademarks used in relation to food products identified with a particular region since at least the end of the nineteenth century, using laws against false trade descriptions or passing off, which generally protect against suggestions that a product has a certain origin, quality or association when it does not. In such cases, the limitation on competitive freedoms which results from the grant of a monopoly of use over a geographical indication is justified by governments either by consumer protection benefits or by producer protection benefits.
One of the first GI systems is the one used in France from the early part of the twentieth century known as appellation d'origine contrôlée (AOC). Items that meet geographical origin and quality standards may be endorsed with a government-issued stamp which acts as official certification of the origins and standards of the product to the consumer. Examples of products that have such 'appellations of origin' include Gruyère cheese and many French wines.
Geographical indications have long been associated with the concept of terroir and with Europe as an entity, where there is a tradition of associating certain food products with particular regions. Under European Union Law, the protected designation of origin framework which came into effect in 1992 regulates the following systems of geographical indications: Protected designation of origin (PDO), protected geographical indication (PGI) and Traditional Speciality Guaranteed (TSG).
In many countries the protection afforded to geographical indications by law is similar to the protection afforded to trademarks, and in particular, certification marks. Geographical indications law restricts the use of the GIs for the purpose of identifying a particular type of product, unless the product and/or its constituent materials and/or its fabrication method originate from a particular area and/or meet certain standards. Sometimes these laws also stipulate that the product must meet certain quality tests that are administered by an association that owns the exclusive right to licence or allow the use of the indication. Although a GI is not strictly a type of trademark as it does not serve to exclusively identify a specific commercial enterprise, there are usually prohibitions against registration of a trademark which constitutes a geographical indication. In countries that do not specifically recognize GIs, regional trade associations may implement them in terms of certification marks.
The consumer-benefit purpose of the monopoly rights granted to the owner of a GI also applies to the trademark monopoly right. Geographical indications have other similarities with trademarks. For example, they must be registered in order to qualify for protection, and they must meet certain conditions in order to qualify for registration. One of the most important conditions that most governments have required before registering a name as a GI is that the name must not already be in widespread use as the generic name for a similar product. Of course, what is considered a very specific term for a well-known local specialty in one country may constitute a generic term or genericized trademark for that type of product. For example, parmigiano cheese in Italy is generically known as Parmesan cheese in Australia and the United States.
Like trademarks, geographical indications are regulated locally by each country because conditions of registration such as differences in the generic use of terms vary from country to country. This is especially true of food and beverage names which frequently use geographical terms, but it may also be true of other products such as carpets (e.g. 'Shiraz'), handicrafts, flowers and perfumes.
When products with GIs acquire a reputation of international magnitude, some other products may try to pass themselves off as the authentic GI products. This kind of competition is often seen as unfair, as it may disourage traditional producers as well as mislead consumers. Thus the European Union has pursued efforts to improve the protection of GI internationally. Accusations of 'unfair' competition should although be levelled with caution since the use of GIs sometimes comes from European immigrants who brought their traditional methods and skills with them.
International trade made it important to try to harmonize the different approaches and standards that governments used to register GIs. The first attempts to do so were found in the Paris Convention on trademarks (1883), followed by a much more elaborate provision in the 1958 Lisbon Agreement on the Protection of Appellations of Origin and their Registration. Few countries joined the Lisbon agreement, however: by 1997 there were only 17 members (Algeria, Bulgaria, Burkina Faso, Congo, Cuba, Czech Republic, France, Gabon, Haiti, Hungary, Israel, Italy, Mexico, Portugal, Slovakia, Togo, Tunisia). About 170 geographical indications were registered by Lisbon Agreement members .
The WTO Agreement on Trade-Related Aspects of Intellectual Property Rights ("TRIPS") defines "geographical indications" as indications that identify a good as originating in the territory of a Member, or a region or locality in that territory, where a given quality, reputation or other characteristic of the good is essentially attributable to its geographic origin. Examples of geographical indications from the United States include: "FLORIDA" for oranges; "IDAHO" for potatoes; "VIDALIA" for onions; and "WASHINGTON STATE" for apples. Geographical indications are valuable to producers for the same reason that trademarks are valuable. Geographical indications serve the same functions as trademarks, because like trademarks they are: source-identifiers; guarantees of quality; and valuable business interests. Although, as mentioned above "geographical indications" are often associated with Europe, the U.S. system for protection of geographical indications can be dated to at least the Trademark Act of 1946.
In 1994, when negotiations on the WTO Agreement on Trade-Related Aspects of Intellectual Property Rights ("TRIPS") were concluded, governments of all WTO member countries (151 countries) had agreed to set certain basic standards for the protection of GIs in all member countries. There are, in effect, two basic obligations on WTO member governments relating to GIs in the TRIPS agreement:
Article 22 of TRIPS also says that governments may refuse to register a trademark or may invalidate an existing trademark (if their legislation permits or at the request of another government) if it misleads the public as to the true origin of a good. Article 23 says governments may refuse to register or may invalidate a trademark that conflicts with a wine or spirits GI whether the trademark misleads or not.
Article 24 of TRIPS provides a number of exceptions to the protection of geographical indications that are particularly relevant for geographical indications for wines and spirits (Article 23). For example, Members are not obliged to bring a geographical indication under protection where it has become a generic term for describing the product in question. Measures to implement these provisions should not prejudice prior trademark rights that have been acquired in good faith; and, under certain circumstances - including long-established use - continued use of a geographical indication for wines or spirits may be allowed on a scale and nature as before.
In the Doha Development Round of WTO negotiations, launched in December 2001, WTO member governments are negotiating on the creation of a 'multilateral register' of geographical indications. Some countries, including the EU, are pushing for a register with legal effect, while other countries, including the United States, are pushing for a non-binding system under which the WTO would simply be notified of the members' respective geographical indications.
Some governments participating in the negotiations (especially the European Communities) wish to go further and negotiate the inclusion of GIs on products other than wines and spirits under Article 23 of TRIPS. These governments argue that extending Article 23 will increase the protection of these marks in international trade. This is a controversial proposal, however, that is opposed by other governments including the United States who question the need to extend the stronger protection of Article 23 to other products. They are concerned that Article 23 protection is greater than required, in most cases, to deliver the consumer benefit that is the fundamental objective of GIs laws.
One reason for the conflicts that occur between the European and United States governments is a difference in philosophy as to what constitutes a "genuine" product. In Europe, the reigning theory is that of terroir, that there is a specific property of a geographical area, and that dictates a strict usage of geographical designations. Thus, anyone with sheep of the right breeds can make Roquefort cheese, if they are located in the part of France where that cheese is made, but nobody can make a blue sheep's milk cheese and call it Roquefort, even if they make it in such a way as to completely duplicate the process described in the definition of Roquefort.
By contrast, in the United States, the naming is considered to be a matter of intellectual property. Thus, the name "Grayson" belongs to Meadowcreek Farms, and they have to a right to use it as a trademark. Nobody, even in Grayson County, Virginia, can call their cheese Grayson, while Meadowcreek Farms, if they bought up another farm elsewhere in the United States, even if nowhere near Grayson County, could use that name. It is considered that their need to preserve their reputation as a company is the quality guarantee.
This difference causes most of the conflict between the U. S. A. and Europe in their attitudes toward geographical names.