1.83. The representative of the United States welcomed this meeting of the Special Session to take stock of the negotiations on the establishment of a multilateral system of notification and registration of GIs for wines and spirits. His delegation fully appreciated that the establishment of the multilateral system of notification and registration would be part of the single undertaking, and was committed to fulfilling the mandate of TRIPS Article 23.4. The consultations had resulted in delegations from different sides coming together for the first time to create a consolidated bracketed text. The discussions in the small group consultations over the past few weeks had also been enlightening and informative. In that connection, his delegation wished to give other delegations not represented in the small group consultations a sense of the negotiations to enable them to make their own decision about what type of multilateral system would be most appropriate for their countries.
1.84. The Joint Proposal Group had put forward a simple, cost-effective and uncomplicated proposal that clearly fulfilled Article 23.4 mandate and would provide good value in assisting WTO Members in their domestic decisions in a manner that clearly facilitated protection. Indeed providing for an international database for examiners to use that all WTO Members had set up would be a feature that did not yet exist. As indicated by the representative of Malaysia, this was equivalent to other systems of intellectual property, as there was no reason to treat GIs differently.
1.85. Whilst appreciating the efforts by the European Union to present its own ideas for texts, he said that regrettably these proposals would dramatically exceed the TRIPS Article 23.4 mandate and require fundamental changes to the national legal systems of many Members. If the Joint Proposal Group had continued to support the same approach for such a long time, it was because the mandate had remained the same since the beginning of the Doha Round. It was not only the Joint Proposal Group which was troubled by the scope and breadth of the EU's proposals, but many other delegations within the W/52 Group had raised serious concerns with the EU's proposals.
1.86. His delegation welcomed the S&D provisions, reflected in the third revised text of the joint proposal (TN/IP/W/10/Rev.3), and aligned itself with Canada's comments. The Joint Proposal Group developed this text, consistent with principles of voluntariness underlying its approach, after close consultation within the group and in particular with developing country Members. He noted that there had not been any S&D proposal from the European Union.
1.87. Through the small group meetings, his delegation had been able to get a clear sense of the EU's objectives in this negotiation, and wished to share some of its concerns. The explanations given by the EU representative in this session simply did not match up with the composite text circulated. First, the EU delegation had confirmed that its proposal was intended to go beyond the Article 23.4 mandate, and provided for the notification and registration of terms other than those related to wines and spirits, as reflected by the EU's support of the title in brackets. When the EU delegation had been asked about the extension of Article 23.4 mandate, the response was that its interpretation of the mandate was different. The representative of the United States wondered then how much clearer the Article 23.4 mandate could be. The only way to interpret the Article 23.4 mandate as including more than wines and spirits would be to ignore the words "wines" and "spirits" clearly expressed in that Article. Moreover, the EU's proposal would appear to extend to a potentially limitless array of products, well beyond the wines, spirits, agricultural products and foodstuffs that were currently covered in the EU. Were there any goods that would not be included? Would the register cover EU's industrial GIs, for example textiles or manufactured goods?
1.88. Secondly, he said, the EU delegation had confirmed that its proposal would give extraterritorial legal effect to EU GIs. This would unacceptably override the fundamental territoriality principle underpinning the global IP system, and cross the boundaries of the Article 23.4 mandate to "facilitate" protection. Although the EU delegation's interventions appeared to suggest that there was no extraterritorial effect, this was contradicted by the draft composite text. In Section D.1, the EU proposed text provided for a prima facie presumption that an EU GI would be a GI in other Members' national systems, and shifted the burden of proving the contrary.
1.89. Thirdly, based on the EU delegation's interventions, it was clear that the EU proposal could significantly burden domestic systems. For example, in many systems, the burden was on the party requesting protection to prove that it had the exclusive right to use the GI, and not up to everyone else to prove that no such right existed. The EU proposal would reverse that burden on right holders, examiners, and the general public in other Members to prove that the foreign GIs were not eligible for protection in their respective territories. He asked delegations to imagine the burden on their domestic systems if they were confronted with hundreds, if not thousands, of GIs that the EU or another WTO Member would request to be registered when the proposed registration system came online. How would their national authorities cope with such a request and how would their producers react?
1.90. The EU proposal appeared to also shift the balance of rights and obligations in the TRIPS Agreement so that those using generic terms or common names for certain goods or services would bear the burden to affirmatively prove that those terms were in fact generic or common. The language of Section D.1(a) and (b) in the draft composite text led off with the prima facie presumption that it "satisfies the definition of 'geographical indication' laid down in Article 22.1 of the TRIPS Agreement" and followed with the provision that genericness must be "substantiated".
1.91. As said earlier by the EU delegation, this meeting had been set aside for Members' questions. The first set of questions related to the excessive burden on each Member's domestic system, both in terms of resources and costs that would be caused by the EU proposal. How much would the EU proposal cost globally for WTO Members, consumers, trademark holders and generic producers? How much would it cost WTO Members, particularly those with no domestic industry associated with GIs, to create and sustain a system for what seemed to be the protection of European GIs and the defence of trademarks and generic terms already on the market?
1.92. A second set of questions related to why the EU proposal shifted the balance of rights and obligations and upended the principle of territoriality. These questions arose from the EU proposals on legal effects in Section D. Why were GI holders absolved of the obligation to establish GI protection in each market in which they desired to be protected and to sell products, while pre-existing trademark holders and producers of products whose names were generic were required to defend, at great cost, a right they already possessed? Why was a presumption favouring GIs established for all WTO markets, based on consumer perception in a single market? Why was the presumption not as it currently was, i.e., the priority of trademarks, GIs and generics was decided in and by each WTO Member? How did the burden shifting proposed by the EU impact on consumers? Why should consumers in markets with pre-existing trademarks and generics be required to accept the perceptions of consumers from foreign markets? In other words, why should a consumer in South Africa, Chile, Australia or Jordan who perceived a reputation in a trademark, be asked to suspend that perception and accept as a given that a GI notified in Northern Italy necessarily had a given reputation? Why must consumers bear the burden of this kind of reputational fiat? Indeed, as said by the delegation of Malaysia, words could mean different things to different people in different places.
1.93. Responding to the EU comment that these questions would be a matter of domestic law and implementation, he said that, without knowing the answers to these questions, Members' understanding of the EU proposal would be incomplete. His delegation would welcome answers from the EU and its supporters in the coming weeks to these and other questions, and would work closely with Members not involved in the small group consultations to ensure that their questions are answered and their concerns taken into account.
