Regulation (EU) 2023/2411 protects craft and industrial products across the EU, such as Carrara marbles and Murano glasses, by extending Geographical Indications (GIs) to non-agricultural products.

Background and Need for Regulation

Historically, the protection of GIs at the European level has been quite robust for wines, spirits, and agri-food products. However, craft and industrial products lacked any sort of harmonized protection, leading to a fragmented landscape where only a few Member States provided specific protections, only at a national level.

Such inconsistency in protection across the EU discouraged investment and left many small and medium-sized enterprises (SMEs) exposed to counterfeit products, posing a risk for consumers purchasing non-original items. The newly introduced Regulation manages to address these gaps, providing uniform protection across the EU and fulfilling the EU’s international commitments under the Geneva Act of the Lisbon Agreement.

The European Commission is currently running a public consultation seeking views on the communication, promotion and the international dimension of craft and industrial GIs under the new Regulation (see EU Survey - Survey (europa.eu)).

Benefits of the New Regulation

The Regulation is particularly significant since it supports SMEs by providing a level playing field and enhancing competitiveness in niche markets. This, in turn, is expected to lead to increased investment and improved quality of supply.

Additionally, the Regulation aims to enhance cultural heritage, boost consumer awareness towards the authenticity of the product, and stimulate tourism. Moreover, by protecting the unique qualities of products linked to specific geographical origins, it helps to preserve local traditions, defend consumers from misleading and unfair conducts, and to promote economic growth by strengthening the EU’s position within the global market.

Criteria and Procedure for Registration

The Regulation protects:

a. “craft products”, i.e. products which are entirely hand-made or which are obtained with the aid of manual, digital or even mechanical tools, wherein the manual contribution is an important component of the finished product, and

b. “industrial products”, products which are manufactured in a standardized way, including by means of mass production and through the use of machines.

To enjoy protection as a GI, the above products must:

• originate from a specific place, region or country;
• possess a quality, reputation or other characteristic which is essentially and inherently attributable to its geographical origin;
• have undergone at least one stage of production in a defined geographical area.

The registration process involves two stages: firstly, a national level and, subsequently, a European level:

• At the national level, applications are submitted to the competent authority, which publishes the details of the application giving third parties the chance to object.
• If there is no objection or the objection is resolved, the national authority sends the application to the European Union Intellectual Property Office (EUIPO), where it is published in a special register and interested parties can again raise objections. Once more, if no objection is received by the EUIPO or if the objection is properly overcome, the application for registration is approved at the European Union level.
• This simplified procedure allows for direct registration of the product through the EUIPO, reducing administrative burdens and costs.

Protection Measures and Compliance

The Regulation provides the same robust protection currently given to agricultural products, wines and spirits, against:

a. any direct or indirect commercial use of the indication in relation to comparable products or the exploitation, weakening, dilution or damage to their reputation;

b. any misuse, imitation or evocation of the protected name;

c. the use of false or misleading indications in terms of the provenance, origin, nature or essential qualities of the product, on packaging, advertising materials or even with reference to information provided on online interfaces,

d. any other practice likely to mislead consumers.

The Regulations also contain specific rules for using GIs in e-commerce, which is currently the most widely used market type, as well as in composite products. Under the Regulation, a product can be indicated as containing a GI as long as this is in accordance with fair trade practices and does not dilute or weaken the reputation of the GI.

Producers have the option to either self-certify their compliance to product specifications or be inspected by relevant authorities to ensure compliance This dual approach ensures that products correctly meet the required standards while at the same time allowing a reduction of the administrative load on producers.

Key components

The new Regulation introduces several important changes compared to the previous ones. It provides a unified and harmonised legal framework for agricultural products, wines and spirits, so far protected by separate laws which are now entirely replaced (Reg. 1151/20121 for agricultural products and foodstuffs) or amended (Reg. 1308/2013 for wines and Reg. 787/2019 for spirits).

Registration procedure

The registration procedure for GIs is considerably simplified thanks to the creation of a two-phase process that includes both a national and EU level. This streamlined approach is designed to reduce administrative burdens and make it easier for producer groups to secure GI protection. (For further details see our earlier article here).

Generic terms

Article 28 of the new Regulation expressly prohibits the registration of generic terms as geographical indications.

To determine if a term has become generic, two factors are relevant:

(i) the prevailing conditions in the regions where the product is consumed; and

(ii) the applicable national or Union legal regulations.

The Regulation clarifies (art. 26.7) that if a geographical indication is a compound name which contains a term which is considered to be generic, the use of that term shall not constitute, as a general rule, a direct or indirect use of the PDO/PGI (ex art. 26.1 lett. s) nor evocation of the same (ex art. 26.1 lett. b).

It appears that the new rule establishes this as a general guideline but does not completely exclude cases where a GI violation might happen. We will see in the next years how Courts will apply this provision in cases of registered compound PDO/PGI which includes generic terms.

Definition of evocation

The Regulation expressly introduces a clear definition of the concept of “evocation” (– prohibited by Art. 26) on the basis of the principles developed by recent European case law. It clarifies that, for the evocation of a GI to occur, it is sufficient that a term, sign, or other labelling or packaging of the contested products creates a link in f the average consumer’s mind to the protected product. At Whereas 35 the Regulations states that “Building on the established case-law of the Court of Justice of the European Union, evocation of a geographical indication may arise, in particular, where a link with the product designated by the registered geographical indication, including with reference to a term, sign, or other labelling or packaging device, is present in the mind of the average European consumer who is reasonably well-informed, observant and circumspect”.

Traditional terms

In relation to the registration and protection of traditional terms, at art. 113a, the Regulation expressly rules on their relationship with PDOs and PGIs. It clarifies that “The registration of a traditional term the use of which would contravene Article 26 of Regulation (EU) 2024/1143 shall be rejected if the application for registration of the traditional term is submitted after the date of submission to the Commission of the application for the registration of the designation of origin or of the geographical indication”.

The provision should prevent situations where Member States attempt to register traditional terms, such as Prosek, that can evoke PDOs, such as Prosecco.

Processed products and prepacked food

By formalising earlier guidelines from the European Commission in 2010/C - 341/03, the new Regulation now protects GIs used as ingredients of more complex processed products. It clarifies that these GIs can be used in the name, label, or advertising material, only if:

i. the processed product does not contain other products comparable to the ingredient designated by the GI;

ii. the ingredient designated by the GI is used in sufficient quantities as to confer an essential characteristic to the product concerned;

iii. the percentage of the ingredient designated by the GI in the processed product is indicated on the label.

Producers of a prepacked food containing a PDO or PGI among the ingredients that intend to use the GI in the name and advertising material of that prepacked food are also required to submit a prior written notification to the producer group in charge of the PDO/PGI’s protection demonstrating that all the above requirements are met. The producer group must then, within four months from the notification, confirm receipt of the notification and once confirmation has been received, or in any case after the expiry of the four-month period, producers may start using the protected name in the name of the prepacked food.

The provision will provide producer groups with greater control over possible illegal uses of the GI on the market.

Emphasis on Sustainability

A notable aspect of the new Regulation is its emphasis on sustainability. Producer groups are encouraged to incorporate sustainable practices into their product specifications, which can include environmental, economic and social initiatives. Such commitments can not only enhance the sustainability of GI products, but also contribute to broader goals such as improving working conditions and supporting local agricultural production.

On 1 May 2024, the Geographical Indications (Wine and Spirits) Registration Act 2006 (GI Act) came into effect in New Zealand. Before the GI Act was enacted, GIs for certain wine and spirits were protected in New Zealand, but to “enforce” other GIs, owners needed to rely on a patchwork of laws, e.g. fair trading legislation, passing off and under trade mark law (like the current position in Australia, discussed below).

The GI Act now provides a comprehensive regime protecting approximately 2,000 EU GIs for food, wine, spirits and other beverages domestically – the full list is available on the GI Register (which is searchable). With the upcoming changes in the EU extending GIs to non-agricultural products, those products will also be able to benefit from GI protection in New Zealand, once registered.

Key Features of the NZ GI Act

The GI Act restricts the use of registered GIs in New Zealand, unless the GI name is used for the “genuine” product that has been imported from the specific location in Europe and complies with the EU requirements for that GI.

The new restrictions apply even if the product:

• indicates its true place of origin, e.g. “New Zealand Prosecco” is not permitted;
• uses a translation or transliteration of the GI; or
• uses the GI alongside words such as “kind”, “type”, “style”, “imitation” or similar, e.g. “Comte-style” in relation to cheese produced in New Zealand is prohibited.

Traders in New Zealand with existing stock in breach of the restrictions can continue to sell stock after 1 May 2024 only until that stock is exhausted. This is subject to a small number of GIs that have phase out periods, namely:

• 5 years for Bayerisches Bier / Bavarian beer, Münchener Bier / Munich beer, Gorgonzola, Grappa, Madeira / Madera, Sherry / Jerez and Prosecco; and
• 9 years for Feta and Port.

The restrictions are also subject to ‘prior users’. Businesses that have used the terms “Gruyère” or “Parmesan” continuously for at least five years before 1 May 2024 may continue to use the term, provided that they do not violate other rights. However, the use of these terms must be accompanied by a legible and visible indication of the geographical origin of the relevant product. For example, a cheese made in Dunedin that is marketed as “Gruyère” must clearly indicate that it originated in New Zealand.

There are also conditions attached to the use of certain GIs under the GI Act.

Finally, there are new enforcement provisions. Any person “with an interest in upholding the restrictions on use of the registered GI” including the Chief Executive under the GI Act, can commence proceedings for breach of a restriction in the GI Act. Under the GI Act, the Chief Executive has appointed “GI Officers” whose role is to enforce compliance and issue financial penalties or seek court-imposed fines. New Zealand Customs is also granted broader powers for investigations, inspections, interceptions and detention of goods.

How can EU businesses prepare?

Holders of EU GIs should consider the following actions:

• Filing a trade mark for their GI to allow an alternative enforcement mechanism especially during the phase out period. For example, traders may still be able to obtain remedies from the Trade Marks Act to combat substantially identical or deceptively similar trade marks like “KOMTE” or “PHETA”;
• Seeking to remove existing third party trade marks using GIs (without authorisation from the relevant GI authority) from the register on the basis of non-use (or to do so at the relevant time);
• Updating current customs watches/notices;
• Appropriate monitoring of the NZ market by conducting regular sweeps; and
• Conducting education and awareness activities in New Zealand to make consumers more aware of their products and the value of GIs.

For EU businesses exporting products to New Zealand, they should ensure their products are not in violation of the GI or, in any case, do not constitute a conduct which could in any case be relevant under other laws to the detriment of the GI holder (e.g. trade mark infringement, unfair competition, misleading behaviour, passing off, etc)

Reciprocity for NZ producers in the EU

Under the FTA, the EU has also pledged to provide similar protection for New Zealand-registered GIs for 23 New Zealand wine GIs. The GI list in both EU and NZ can be amended. In addition, the free trade negotiations has also opened the door for GI protection of “flowers and ornamental plants” and “products of the milling industry” in both NZ and the EU.

Although GIs have been controversial in Australia because GIs are not generally recognised as a separate intellectual property right, there may be changes on the horizon with the continuation of negotiations between Australia and the EU for the Australia-European Union Free Trade Agreement (EUFTA). Negotiations commenced on 2 July 2018, but came to a halt on 28 April 2023. The negotiations are expected to resume in late 2024. GIs were a significant focus of the negotiations.

Australia currently protects GIs in a several ways:

1. Firstly, a dedicated wine GI framework protects some wine and spirits as GIs. Australia claims that this is one of the ways it fulfils its obligations under the Trade-Related Aspects of Intellectual Property Agreement 1994 (TRIPS). The Wine Australia Act 2013 (Cth) and Wine Australia Regulations 2018 (Cth) presently protects 116 Australian wine GIs. But unlike the GI laws in Europe, these statutes do not set any requirements around production methods, typicality or growth. The legislation only mandates that 85% of the grapes in a wine must originate from the GI region for a GI to be used on the label. While there are other requirements for wine labelling that aim to help consumers understand the provenance of a product, not all wine GIs that are recognised in Europe are protected. 
    
2. Another way GIs have been protected in Australia is under the Australian Consumer Law, in Schedule 2 of the Competition and Consumer Act 2010 (Cth) (ACL). This could, for example, be used where packaging of a product contains symbolism or flags of a country associated with a GI, but the product may not be produced there.
    
3. Certification trade marks (CTMs) under the Trade Marks Act 1995 (Cth) may also provide some protection. This is the second mechanism through which Australia implements obligations under TRIPS. However, there are limitations with the CTM framework which mean GIs protected as CTMs are not necessarily protected in the same way as a separate, statutory right (as discussed above for some wines). 
    
4. There are also protections offered under common law such as the tort of passing off at common law but again, enforcement of these laws is challenging.

In the EUFTA negotiations, the EU has requested that Australia protect 236 spirit names and 172 agricultural and other foodstuff names as GIs in Australia. It has also requested that GI names are not be permitted to be used (directly or indirectly) for comparable products, that the regulations should apply to product ingredients, and that they should extend to expressions such as “style” and “type” etc. that indicate a connection.

The Australian Government has been actively consulting with local industry and other stakeholders during the negotiations. However, it has received a significant pressure from the Australian agricultural lobby. One way forward could be to have a reciprocal protection system like the one in New Zealand.

In any event, once the EUFTA negotiations are finalised, the Australian Government will further consult on any draft legislation for GIs. In light of New Zealand implementing expanded GI protections and Australia’s trading position in the Asia-Pacific, there is a good case for Australia to reconsider its position on GIs. We will continue to monitor and report on further developments.

What can EU businesses do in the meantime?

While waiting for implementation of a specific GI regime also in Australia, GI stakeholders should seek to utilise the current legal framework effectively by:

• ensuring that robust trade mark protection and enforcement strategies are in place, including clearance, filing and watch services to monitor new trade marks;
• ensuring market sweeps are periodically conducted to identify problematic products;
• engaging and investing in promotion and increasing awareness through education of their GI products across Australia; and
• considering enforcement actions beyond comparable products, e.g. considering the ACL in any brand extension-type scenario.