oriGIn Alerts 20 June 2016: #TheEconomist #GIs

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#TheEconomist #GIs 

In response to the article “For the love of pizza”, published by the Economist on June 4th under the column “Charlemagne”, oriGIn and AICIG sent some comments with the objective to clarify some of the issues raised by the article. Please find below our message:

Dear Sir,

The Protected Geographical Indication (PGI) and the Protected Designation of Origin (PDO) schemes for food and wine names, as well as the Geographical Indications (GIs) scheme protecting spirit drinks, represent in the EU a tremendous source of job creation and economic development in rural areas, with an estimated sales value of 54.3 billion EUR (source, European Commission, 2010). While Mediterranean countries, including Italy, benefit of course from these schemes, PDO/PGI and GIs respond to the needs of rural communities in a variety of States across the EU, with countries like Germany and the UK accounting in aggregate for 21% of the total sale value of the EU PDO/PGI and GIs. If over the last few years Italy and other European countries have experienced slow economic growth, in our view this is certainly not due to PDO/PGI and GIs, which have rather contributed to investments and dynamism in rural communities. 

PDO, PGI and GIs are internationally recognized intellectual property rights (the World Trade Organization TRIPs Agreements, in its articles 22-24, speaks in general about GIs) and as such must be protected by all 162 WTO Members States. As other intellectual property rights, GIs do not serve protectionism or rent maximization purposes, like Charlemagne argued, but rather reward investments in quality linked to the geographical origin of products, provide consumers with real choice, and ensures the continuity of traditional knowledge and practices. That’s why GIs are spreading all over the world and has become a truly global concept, with an estimated number of 9.000 GIs already recognized around the world (some 2.000 in China, 400 in South American countries and some 300 in the US considering the American Viticultural Areas and the geographical certification trademarks). 

According to a recent study of the European Union Intellectual Property Office (EUIPO), the infringement of European PDO/PGI and GIs totaled approximately €4.3 billion in 2014, corresponding to 9.0% of the total products’ market. Infringements and other forms of undue exploitation of their reputation are a serious issue for GIs around the world, with a major impact in terms of reputation and legal costs. Outside the EU, one might mention the cases of Colombian Coffee, Blue Mountain Coffee, Tequila, Napa Valley, Darjeeling Tea, Pisco, Cachaça, Argan Oil and Kobe Beef, just to name a few. This explains why a certain level of administrative enforcement is crucial, also taking into account that a large majority of GIs producers are micro and small enterprises, which do not have the financial resources to fight long legal battles. A certain level of public enforcement on rights or standards considered of high value by consumers is certainly not incompatible with a modern market economy. As a way of example, in the US, as consumers look for and trust the US organic seal, the National Organic program (NOP) of the USDA’s Agricultural marketing Services, in addition to setting robust, meaningful standards that organic businesses are required to follow, also defends the organic seal by taking appropriate enforcement actions if there are violations of such standards. 

Different from PDO/PGI and GIs is the case of Traditional Specialties Guaranteed (TSG). TSG do not represent intellectual property rights, have in the EU limited impact in numbers and economic effect, and are not the object of consistent administrative enforcement. In light of this, we believe PDO/PGI and GIs should not have been associated with TSG in the way Charlemagne did. 

We hope these remarks will stimulate a fruitful debate.

Best regards,

Massimo Vittori, Managing Director, oriGIn, the global alliance of GIs (www.origin-gi.com)
Leo Bertozzi, General Director, AICIG, Association of Italian GIs (www.aicig.it)

oriGIn and AICIG comments can also be found @ http://www.economist.com/node/21699922/comments#comments




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