129. The representative of the United States associated his delegation with the views expressed by the delegations of Australia, New Zealand, Canada, and Japan. He welcomed the clarifications made by the representative of the European Communities as his delegation's reading of the EC proposals was that they delivered practically all of what he was saying they did not want. He further explained the concerns his delegation was having with regard to the EC proposal. It included the presumption that one Member's determination regarding a GI would have a certain legal standing in the territory of other Members. That would be unworkable in the US legal system and clearly at odds with the most basic principles underlying the TRIPS Agreement and IPR protection more generally. Members were mandated to establish a multilateral system of notification and registration of GIs for wines and spirits in order to facilitate the protection of those GIs. That mandate provided neither for the expansion of the GI protection nor the encroachment upon other IP rights. They were not in any manner mandated through this negotiation to weaken or potentially negate other rights that were currently existing within the territories of WTO Members. The EC proposal would place existing right holders in an automatically defensive position and subject to the loss of their rights simply by virtue of a name being placed on a list based on a determination of its IP status made in another territory. These right holders would then be required through mechanisms that were still extremely unclear to his delegation to take affirmative action to defend their existing rights or to invoke one of the TRIPS exceptions. Under the EC proposal as just explained, a notified term would be presumed to meet the TRIPS definition. By virtue of this short circuiting or circumvention of domestic examination and procedures, the validity of any conflicting use in the receiving country would automatically and immediately be called into question, notably before the courts. While the continued availability of the exceptions spelt out in Article 24 of TRIPS was important to note, this did not at all overcome this fundamental problem of short circuiting of domestic decision-making through these presumptions and the reversal of the burden of proof. This change was a fundamental shift. As regard the exceptions under Article 24, he said that they were not even sacrosanct because the EC proposal put forward that a notified GI would be presumed to be non generic, and that would be a limitation.
130. He further said that the trademark system was based on consumer perception. If it was found that consumers were deceived by the use of a mark on a particular good, that mark would be invalid. The fact that a notified term was presumed to meet the TRIPS GI definition in the receiving Member's territory meant that any conflicting uses would immediately be deemed geographically deceptive by operation of law. That was the way this would work. In other words, under the EC proposal the act of notification would be deemed to artificially create knowledge of perceptions of consumers in the receiving Member or, in other words, to presume that the consumers in the US identified a particular GI with a particular good. The EC was asking his country to create this consumer perception by statute or regulation rather than to infer it from actual consumer's experience. To put it mildly, this was a radical shift in the concepts and in the legal foundations of the trademark field. It would significantly impact the operation of national trademark systems in a profound and far-reaching and quite unpredictable way. Under the EC's revised concepts where the presumption would be rebuttable, there were significant questions as to whether, at what cost to existing right holders, and through what procedures that presumption could be rebutted even within the US system. Thus, it appeared that this process of rebutting presumptions would, to a very significant degree, be played out in US courts, would unleash domestic litigation on a scale undetermined, and could be quite significant. This extremely burdensome process would also have to be repeated in every Member's territory in which existing right holders sought to maintain those rights. It was fundamentally unfair and unreasonable that in order to facilitate protection of GIs the rights of other right holders should be placed in legal jeopardy. There must be a better and fairer way, which his delegation thought it had already found.
