geographical indications

The last few weeks have seen increasing rumblings within Australia about some of the consequences if a possible Free Trade Agreement with the EU goes through.

One of the main features the EU is seeking is expanded protection for the thousands of “GIs”, or geographical indications, recognised in the EU.

The potential impact of the EU FTA requiring Australian producers to stop calling their non-Italian products ‘prosecco’, a GI in the EU, has been generating some media excitement: see:

• ‘Prosecco-like?’: EU digs in over fight to rename Australian wine and cheese
• They can have parmigiano but, damn it, we’re keeping prosecco

Professor Mark Davison and colleagues have a paper forthcoming in the AIPJ exploring the validity of the claims to protection [SSRN paper here]

We have been here before – when the EU-Australia Wine Agreement knocked out use of names like ‘champagne’ in return for greater access to the EU for Australian sparkling and other wines.

When the second version of that agreement replaced the 1994 version, the National Interest Assessment pointed out:

8. In 2006-07, Australia exported 421 million litres of wine to the EC with a value of $1.3 billion, and imported 10.2 million litres with a value of $168 million. Key regulatory and intellectual property issues related to trade in wine between Australia and the EC are currently regulated by the 1994 Agreement. 

9. The Agreement offers a number of advantages to Australian wine-growers, which will help consolidate their access to the EC market at a time when the domestic industry still faces concerns about an over-supply. The new Agreement also resolves several outstanding issues not covered by the 1994 Agreement, and thus will help maintain a mutually beneficial trade relationship with the EC.

10. In particular, the Agreement obliges the EC to permit the import and marketing of Australian wines produced using 16 additional wine-making techniques. It also sets out a simpler process for recognition of further techniques, with an option for disputes to be resolved by a binding arbitration. Under the 1994 Agreement, by contrast, the process for authorisation of new wine-making practices has no binding dispute settlement procedure, and no new practices have been authorised under the 1994 Agreement. This has been particularly problematic for Australian wines produced with an important wine-making technique involving the use of cation exchange resins to stabilise the wine. This technique was provisionally authorised for 12 months under the 1994 Agreement, and this authorisation has since had to be periodically extended for 12-month periods.

11. The Agreement also obliges the EC not to impose any new wine labelling requirements that are more restrictive than those which apply when the proposed Agreement comes into force. This means that industry will not face the difficulties and additional costs that might arise if the EC was permitted to introduce more onerous wine labelling requirements.

12. Finally, the Agreement obliges the EC to recognise and protect new Australian wine Geographical Indications. A Geographical Indication is a label or sign used on goods that have a specific geographical origin and possess qualities or a reputation that are due to that place of origin.

How it will play out this time, who knows? As usual, the Australian government is keeping its position largely secret from us. The EU, however, is quite open about what it is seeking (Compare DFAT here and here and here to EU proposed text here see esp. article X.22 and from X.31 and generally).