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Geographical Indications_ Coffee


									 Geographical Indications,
   Coffee and Economic
Development: The Ethiopia -
      Starbucks Case
              James Watson
       Commonwealth Secretariat
  Ministry of Trade & Industry, Ethiopia
      Presentation Contents
• Introduction – The role of IPR in
• The Ethiopia/Starbucks Case
• The Context of the case
• Geographical Indications (GI)
• Criticisms of GIs in the Case
• IPR, Property Rights and Development
• Conclusion – Benefits of a GI system
     Intellectual Property Rights
           and Development
• How can IPR be used as a tool for

• What are the benefits of IPR for
  developing countries?

• Can the current EPA and WTO
  negotiations be used to achieve IPR
  benefits for developing countries?
      Ethiopia and Starbucks
• Ethiopia tries to trademark three coffee
  varieties with the USPTO

• One rejected as it was deemed generic –
  Starbucks instrumental in this decision

• A compromise solution could use a GI
  model and a licensing agreement
    The context of the Case (1)
• 2004 - 17 billion pounds of coffee grown, 85%
  traded internationally

• Speciality coffees have grown in value – 2001
  40% of coffee value sold in US

• Speciality coffees command a higher price, 20
  cents above the international coffee market price

• Much of the extra value being absorbed by
  retailers rather than producers
   The context of the Case (2)
• How to improve the incomes of developing
  country farmers?

• What of the problems of land ownership
  and access to capital?

• Are trademarks the best way forward for
  securing a greater share of the profits?
  Geographical Indications (GI)
• TRIPS definition:
 ‘Indications which identify a good as originating in the territory of a
 Member, or a region or locality in that territory, where a given
 quality, reputation or other characteristic of the good is essentially
 attributable to its geographical origin’

• A GI represents a designation of quality
  and suggests a higher standard of product

• Both profits and employment can be
  improved through the use of GIs
      Geographical indications in
          International Law

• TRIPS Article 23: the wines and spirits standard

• The loopholes of TRIPS include: prior
  registration, generic names & good faith use

• EU proposals under DDA: extension of article 23
  provisions, a global register & removing prior
     Geographical Indications in
       Developing Countries
• The use of GI in developing countries is

• However: Blue Mountain coffee offers a
  realistic example for the Ethiopian case

• There are developing countries who
  support the use of GIs in the WTO –
  Kenya, Nigeria and Mauritius in Africa
Geographical Indications in EPA
• Ethiopia is in the ESA group of countries
  configured for EPA

• ESA have proposed text on GIs and there is
  support for this from the EU

• Part of the proposed EPA text:
  To grant legal protection to geographical indications identifying
  products of ESA countries in both the Community and among ESA
     Some criticisms of GIs in the
       Ethiopia/Starbucks case
Some commentators have suggested the following
criticisms of an approach using GIs:
•   The purpose of the GI is not aligned with the goal of the
    Ethiopian coffee sector – getting a better price for their

•   GIs are designed to defend valuable intellectual property,
    not to develop economic value.

•   GIs would be extremely costly to govern.

•   GIs are unnecessary.
       IPR, Property Rights and
• For those who do not own land, it may be possible
  to take advantage of GIs, in order to acquire
  investment capital

• It will be in the interests of the coffee retailers to
  support the farmers’ training and to provide
  technological assistance to support higher quality
  coffee production

• If GIs for coffee are enforced, this can help
  streamline the coffee supply chain and bring more
  profits to the farmer and retailer
    Conclusions – Benefits of GI
•   The use of GIs can be seen as a means to improve the livelihoods
    of coffee farmers in Ethiopia, and more generally agricultural
    producers in developing countries.

•   The benefits of GIs in developing countries can be summed up as

    – Empowerment through economic development and legal
      ownership of a product type;

    – Equity through giving ownership of products to persons in
      developing countries – 97% of patents worldwide belong to
      developed countries, including 80% of patents registered in
      developing countries - GIs have the potential to be more evenly

    – Productivity through the increased investment opportunities
      associated with the increased economic performance of a GI
      protected product
Thank you for your attention

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