The Centad working paper tracks the negotiating history of TRIPS in search of the origin of GI-related (Geographical Indications) provisions and provides a cogent account of various contours of WTO negotiations on GI to date. It also analyses the Indian GI Act in light of the TRIPS provisions.

By Kasturi Das
Research Officer, Centad

This paper is a comprehensive overview of a range of issues in the context of Geographical Indications (GI) protection, with a particular focus on India. It tracks the negotiating history of Trade-Related Aspects of Intellectual Property Rights (TRIPS) in search of the origin of GI-related provisions, and provides a cogent account of various contours of the World Trade Organisation (WTO) negotiations on GI to date. It also analyses the Indian GI Act in light of the TRIPS provisions, portrays the current status of GI registration in India, and offers important policy suggestions for India. To download the full paper in PDF format, click here.

Protection of GI has, over the years, emerged as one of the most contentious IPR (Intellectual Property Rights) issues in the realm of the WTO’s Agreement on TRIPS. TRIPS defines GI as any indication that identifies a product as originating from a particular place, where a given quality, reputation or other characteristics of the product are essentially attributable to its geographical origin.

Much like trademarks, GI act as a signalling device that helps producers differentiate their products from competing products in the market, and enables them to build a reputation and goodwill around their products, which often fetch a premium price. Although GI and trademarks perform somewhat similar functions of building reputation and goodwill, there are important differences between GI and an individual/ordinary trademark.

Given its commercial potential, legal protection of GI assumes enormous significance. Without such protection, competitors not having legitimate right on a GI might ride free on its reputation. Such unfair business practices result in loss of revenue for the genuine right-holder of the GI and also misleads consumers. Moreover, such practices may eventually hamper the goodwill and reputation associated with the GI.

At the international level, TRIPS sets out minimum standards of protection that WTO members are bound to comply with in their respective national legislations. However, as far as the scope of protection of GI under TRIPS is concerned, there is a problem of hierarchy. This is because, although TRIPS contains a single, identical definition for all GI, irrespective of product categories, it mandates a two-level system of protection: (i) the basic protection applicable to all GI in general (under Article 22), and (ii) additional protection applicable only to the GI denominating wines and spirits (under Article 23).

This kind of protection is problematic, because Article 22 fails to provide sufficient intellectual property protection for the benefit of the genuine right-holders of a GI. A producer not belonging to the geographical region indicated by a GI may use the indication as long as the product’s true origin is indicated on the label, thereby free-riding on its reputation and goodwill.

The origin of this hierarchical protection may be traced back to the negotiating history of the Uruguay Round (1986-94). The greater level of protection for wines and spirits was granted solely for the political reason of persuading the European Community (EC) to join a consensus on the Uruguay Round package, despite strong opposition from many other countries.

There exist significant divergences among WTO members with regard to modes of protection of GI. The WTO Secretariat has classified all these diverse means of national protection into three broad categories:

  • Laws focusing on business practices.
  • Trademark law.
  • Sui generis protection.

India has enacted the Geographical Indications of Goods (Registration and Protection) Act, 1999 (GI Act), as part of an exercise to set in place national intellectual property laws in compliance with India’s obligations under TRIPS. Under the purview of this Act, which came into force on September 15, 2003, the central government has established the Geographical Indications Registry with all-India jurisdiction, at Chennai, where right-holders can register their GI.

Interestingly, unlike TRIPS, the counterpart of Article 23 in the GI Act does not restrict itself to wines and spirits. Rather, it has been left to the discretion of the central government to decide which products should be accorded higher levels of protection. This approach has deliberately been taken by the drafters of the Indian Act with the aim of providing Article 23-type stringent protection to GI of Indian origin. However, other WTO members are not obligated to ensure Article 23-type protection to all Indian GI, thereby leaving room for their misappropriation in the international arena.

Aware of the inadequacy of the protection granted under Article 22, since 2000, India, along with a host of other likeminded countries (for example, the European Union, Bulgaria, China, the Czech Republic, Hungary, Liechtenstein, Kenya, Mauritius, Nigeria, Pakistan, the Slovak Republic, Slovenia, Sri Lanka, Switzerland, Thailand and Turkey) has been pressing for an ‘extension’ of the ambit of Article 23 to cover all categories of goods. However, countries such as the United States, Australia, New Zealand, Canada, Argentina, Chile, Guatemala and Uruguay are strongly opposed to any ‘extension’. The ‘extension’ issue formed an integral part of the Doha Work Programme (2001) as an ‘outstanding implementation issue’. Nevertheless, as a result of the wide divergence of views among WTO members, not much progress has been achieved in the negotiations so far.

Around 30 GI of Indian origin have already been registered with the GI Registry. These include GI like Darjeeling (tea), Pochampalli, Ikat (textiles), Chanderi (sarees), Kancheepuram silk (textiles), Kashmir Pashmina (shawls), Kondapalli (toys), and Mysore (agarbattis). There are many more Indian GI in the pipeline for registration under the GI Act.

There are a number of issues and concerns in the context of harnessing the potential benefits of GI registration in India. Apart from effective enforcement of GI in the relevant markets (domestic and export), it is apprehended that without well-crafted policies and strategies on marketing and promotion of Indian GI, their underlying commercial potential might remain unrealised.

At the multilateral level, it is extremely important for India to weigh the costs and benefits of GI protection in general, and the ‘extension’ of Article 23 in particular. Given the scarcity of research-based inputs in this regard, there has so far not been much clarity on these issues. Hence, rather than pushing too hard for the ‘extension’ at the WTO, a more prudent approach on the part of India would be to ‘go slow’.

Meanwhile, the country should explore the economic and socio-economic benefits and costs of GI protection, on the basis of rigorous empirical research. This would enable India to adopt a more informed negotiating stance on the issue of an ‘extension’, at the WTO.

June 2007