TAO I WIPO WORLD GENEVA ORIGINAL English DATE June

(//3S-:) TAO/I/ 4 WIPO WORLD GENEVA ORIGINAL: English DATE: June 28, 1974 INTELLECTUAL PROPERTY ORGANIZATION COMMITTEE OF EXPERTS ON THE INTERNATIONAL PROTECTION OF APPELLATIONS OF ORIGIN AND OTHER INDICATIONS OF SOURCE Geneva, November 4 to 8, 1974 OBSERVATIONS OF THE GOVERNMENT OF THE FEDERAL REPUBLIC OF GERMANY This document contains a letter from the Government of the Federal Republic of Germany, including two attachments consisting of previous letters from that Government, concerning the international protection of appellations of origin and other indications of source. TAO/I/4 page 2 Letter from Dr. h.c. A. Krieger, Ministerialdirektor, Ministry of Justice of the Federal Republic of Germany, of April 10, 1974, addressed to the Director General of WIPO (Extract) The Government of the Federal Republic of Gennany has interest that the World Intellectual Property Organisation from the member countries of the Paris Union to begin work the Lisbon Agreement for the Protection of Appellations of International Registration. noted with great has ~nvited experts on a revision of Origin and their As you know and as demonstrated by the number of bilateral treaties i t has concluded with other states, my Government since many years has been a strong advocate for an improvement of the international protection of appellations of origin and indications of source. It is of the opinion that such an improvement would be in the interest of the local producers, in the interest of international trade and especially in the interest of the consumers. It is aware of the fact that appellations of origin and indications of source are of considerable economic importance both for the industrialized and the developing countries. From the deliberations of the competent organs of the Lisbon Union we have learned with great interest that the aims of the intended revision are not confined to certain improvements within the system of the Lisbon Agreement, but that a harmonisation of all the existing international efforts in this field is sought and that an attempt will be made to arrive at a single international agreement with a high standard of protection and with enough fleXibility to allow the participation of a large number of states. As in the fieldS of patents and trademarks the Government of the Federal Republic of Germany is of the opinion that the international protection of the appellations of origin and the indications of source will not only depend on the material provisions of such an agreement, but also on the question whether it will be possible to achieve a worldwide acceptance of the agreement. We are convinced that a solution acceptable for a great number of states can be found. In my letter of March 11, 1971, and in my Government' s reply of May 1972 to the Questionnaire of WIPO, copies of which are attached to this letter, some ideas have been put forward which are based on our experience with the said bilateral treaties and which may prove useful in the deliberations of the committee of experts. Of course, we will be most interested to study all other ideas raised in these deliberations as well, and we should, in our opinion, take all the time necessary to arrive at good results. I thought it might be useful for the preparation of the committee of experts meeting to point at the basic aims the intended reform should try to achieve in our opinion and to emphasize our interest to find an acceptable and workable solution. LTWO annexes follo~1 TAO/I/4 Annex I Letter from Dr. h.c. A. Krieger, Ministerialdirektor, Ministry of Justice of the Federal Republic of German~of May 11,1971, addressed to the Director General of WIPO (Extract)* 1. The German Federal Government attaches considerable importance to the strengthening of the protection of indications of source, including appellations of origin. In its opinion, such protection is not only in the interests of commercial undertakings lawfully using such indications, but it also serves to protect the consumer against deception. The German Federal Government has, therefore, always been in favor of· effective international protection of indications of source, and has followed with great interest the conclusion and subsequent development of the Lisbon Agreement, of October 31, 1958, for the Protection of Appellations of Origin and their International Registration. It considers this Agreement to be a significant step towards the improvement of the international protection of geographical indications of source. Nevertheless, it is of the opinion that the conditions imposed by the Lisbon Agreement in its present form on the protection of appellations of origin do not take sufficient account of the diversity of the legal systems of countries interested in protection by treaty. It considers this to be the main cause of the Lisbon Agreement's failure so far to attain the desired extension of its territorial scope. 2. In the opinion of the German Federal Government, the broadening of the scope of the Lisbon Agreement is hampered mainly by two particular conditions of protection laid down by the Agreement itself. (a) Under Article 1(2) of the Lisbon Agreement, the only appellations of origin which come within the ambit of the protection of the Agreement are those which are recognized and protected as such in the country of origin. Protection in the country of origin must be established by a specific legislative, judicial or administrative act. Moreover, the Regulations of the Agreement provide expressly that the application for international registration must indicate the 1egialative or administrative provisions or judicial decisions recognizing protection of the relevant appellation in the country of origin. *This letter appears as an annex to document AO/VI/4 TAO/I/4 Annex I page 2 This condition of protection appears to the German Federal Republic to be specially designed for States in which the national law makes the protection of a national appellation of origin contingent on express prior State recognition. It does·not, on the other hand, do sufficient justice to the need for protection in States which do not grant such recognition to national appellations of origin but afford protection to them on the basis of general legislative provisions prohibiting deceptive publicity. Such States, in the event of their accession to the Lisbon Agreement in its present form, could apply for protection under the Agreement for only a very few appellations of origin which are subject to special protection in accordance with measures decreed by the State. (b) Furthermore, for States having such a system of protection, based solely on the prohibition of deceptive publicity, it is rarely, if ever, possible to meet the condition laid down by Article 5(1) of the Agreement in respect of an appellation of origin. That Article provides that appellations of origin are registered in the name of the persons who, according to the legislation of the country of origin, are the owners of the right to use such appellations. In accordance with that provision, Article 1(1) of the Regulations of the Lisbon Agreement prescribes that every application for international registration of an appellation of origin must indicate the owner or owners of the appellation. In contrast to States which provide for a special recognition procedure for appellations of origin, the require~ ment to indicate the owner is unknown to States which afford protection to appellations of origin only on the basis of the prohibition of deceptive publicity. Under their legal systems, the appellation may be lawfully used by any enterprise having its domicile in the locality or area indicated for its own products, on condition that such products comply with the quality standards customary in the trade. In those States, the demarcation of entitlement is not in terms of persons but rather in terms of territory. For that reason, also, such States, in the event of their accession to the Lisbon Agreement, could apply for protection for only a few appellations of origin, if any at all. - _ '---ec~- _ .. _ .. ' - - TAO/I/4 Annex I "age 3 3. The Federal Republic of Germany is one of the States which do not make the protection of appellations of origin contingent on recognition through measures decreed by the State. Under German law, the protection of indications of source, including appellations of origin, is based on the provisions of the Law of ~une 7, 1909, on Unfair Competition (Reichsgesetzblatt,page 499)., last amended by the law of June 26, 1969 (Bundesgesetzblatt I, page 633), Articles 3 and 4 of. which prohibit, in general, the use of geceptive indications. Under that Law, it is fundamentally unlawful to use indications of source for products which are not produced in the locality or area indicated. In addition, however, the quality standards associated by the trade circles concerned, with an indication of source, have to be respected, because Articles 3 and 4 of the Law on Unfair Competition also prohibit the use of deceptive indications concerning the essential characteristics of products. The protection of practically all German indications of source rests exclusively on these general provisions. Only a few isolated geographical appellations enjoy special protection as a result of special legislative provisions. The most important among these is the "Solingen" appellation. Judicial decisions exist only in relation to a few appellations, generally those where it was doubtful whether or not they had become generic names. Since, as a rule, the general prohibition laid down by Articles 3 and 4 of the Law on Unfair Competition is complied With, decisions establishing protection for an individual appellation are rare. As for administrative measures establishing the protection of individual appellations, at the_most the registration of certain appellations for wine in the Vineyards Register (Weinbergsrolle) could be considered to come into this category. Under the Lisbon Agreement in its present form, the Federal Republic of Germany, like other States which have the same legal system, could therefore apply for international registration only in respect of a very limited number of appellations. Indeed, the best known German indications of source, which are usually respected by competitors, would not qualify for protection under the Lisbon Agreement. 4. As the Federal Republic of Germany is unable, for the reasons given, to accede to the Lisbon Agreement in its present form, it endeavors to ensure the protection of indications of source through bilateral treaties. It has so far concluded such treaties with France (Agreement of TAO/I/" Annex I page 4 March 8, 1960, Bundesgesetzblatt 1961, II, page 23), Italy (Agreement of July 23, 1963, Bundesgesetzblatt 1965, II, page 157), Greece (Agreement of "April 16, 1964, Bundesgesetzblatt 1965, II, page 177), Switzerland (Treaty of March 7, 1967, Bundesgesetzblatt 1969, II, page 139) and Spain (Treaty of September 11, 1970), and plans to conclude other treaties of the same sort with other States. Unlike the Lisbon Agreement, those treaties are based on the principle that, in each case, the law of the country of origin determines the substantive conditions of protection of geographical appellations in the other contracting State. This rule leaves the States party to the Treaty free to decide whether they wish to provide for protection in their national law for indications of source, including appellations of origin, through general provisions on unfair competition or separate legislative, judicial or administrative measures. It is not, therefore, tailored to any definite legal pattern but makes it possible for every legal tradition to fit into the treaty system. 5. This flexible solution, in the opinion of the German Federal Government and in that of its treaty partners, has proved a success. Consideration should therefore be given to the question whether a solution of the same kind should not be found for the Lisbon Agreement, which would enable the Federal Republic of Germany and other States with similar legal systems to accede to that Agreement in the same way as States having a different legal tradition. LEnd of Annex 1/ LAnnex II follow§! TAO/I/4 Annex II Letter from the Government Llf tIle Federal Republic of Gl:rllldny, of May hi in reply to WIPO's Circul.ll- No. 1338 of November 11, 1971 (Extract)* J~72, I. The Goverrnent of the Federal Republic of Germany attaches great i.mpo r t e ncu to strengthening the protection of indications of source including appellations of origin. It considers that such a protection serves both the interests of business enterprises making legitimate use of such indications and the interests of consumers whom it preserves from being misled. The economic importance of such indications for international trade should not be underestimated. The Federal Government has, therefore, been following with great interest all previous efforts to improve the protection of indications of source at an international level. It has since 1925 been a member of the Madrid Agreement of 14 April 1891 for the Repression of False or Deceptive Indications of Source on Goods. It vigorously supported the Lisbon Conference in 1958 in its endeavours to strengthen the protection of indications of source within the framework of Article 10 of the Paris Convention. It has been following with particular interest the conclusion and subsequent development of the Lisbon Agreement of 31 October 1958 for the Protection of Appellations of Origin and their International Registration. For reasons specified under II below it has not, however, seen itself in a position to accede to that Agreement. The Federal Government's strong interest in the protection of indications of source at an international level is, moreover, manifest in a number of bilateral agreements which it has concluded with five European countries, i.e., with France on 8 March 1960 (Bundesgesetzblatt (Federal Law Gazette) 1961 II p. 23 = Propriete Industrielle 1960 p. 213); with Italy on 23 July 1963 (Bundesgesetzb1. 1965 I I p. 157). with Greece on 16 April 1964 (Bundesgesetzbl. 1965 I I p. 177). with Switzerland on 7 March 1967 (Bundesgesetzb1. 1969 II p. 139 = Propri§te Industriel1e 1969 p , 64) and with Spain on 11 September 1970 (Bundesgesetzbl. 1972 II p. 109). The German-Portuguese Commerce and Navigation Agreement of 24 August 1950 (Propriete Industrielle 1950 p. 246) and the German-Cuban Agreement of 22 March 1954 (Bundesgesetzb1. 1954 II p. 1112) also contain stipulations on the protection of certain indications of source. II. 1. The Federal Government recognizes the Lisbon Agreement for the Protection of Appellations of Origin and their International Registration as a remarkable step towards improving the international protection of indications of source. It is, however, of the opinion that the conditions of protection under the Lisbon Agreement in its present form do not make sufficient allowance for the different legal syst:ems of the countries interested in an international protection. This, in its view, is the decisive reason why the Agreement has so far not acquired the territorial scope desired. Two particular requirements of the Agreement are thought to be an obstacle the widening of its sphere of application. ti, ,I' letter appears in Annex II to document P/EC/VIII/6 TAO/I/4 Annex II page 2 (a) Article I, paragraph 2, of the Lisbon Agreement provides that only appellations of origin recognized and protected as such in the country of origin may enjoy its protection. Proter.~ion in the country of origin must have been established by a special act, either statutory, judicial or administrative, for each indication concerned. The regulations for the implementation of the Agreement, moreover, provide explicitly that the legal provision or judicial decision by which the protection of the individual appellation is recognized in the country of origin has to be specified in the request for international registration. This condition of protection appears to have been tailored to countries whose national legislation makes the protection of domestic appellations of origin subject to having been explicitly recognized by a government measure. It does not, however, meet the requirements of those countries which ensure the protection of domestic appellations of origin without such recognition simply on the grounds of a general statutory prohibition of the use of deceptive indications in business activity. If these countries would accede to the Lisbon Agreement in its present form they would not be able to apply for the registration of their appellations of origin except in few exceptional cases where certain appellations are specially protected by virtue of a specific government or court measure. (b) Moreover, countries with a system of protection that is based solely on a general prohibition of the use of deceptive indications in business activity will not, or only in rare cases, be in a position to comply with the provisions of Article 5, paragraph 1, of the Agreement, which requires appellations of origin to be registered in the name of those persons who under the legislation of the country of origin have a right to use them. In accordance with this provision, Article I, paragraph 1, of the implementing regulations provides that the owner or owners of each particular appellation must be named in any application for international registration. Even if these provisions are applied in such a manner that the application need only describe the region to which the appellation refers, they will still raise considerable problems for countries which ensure the protection of their indications of source solely on the basis of a general prohibition of the use of deceptive indications in business activity. Provisions requiring definition of the region for which indications of source may be used are generally alien to the legal systems of these countries. The criterion, according to these systems, is whether the indication may mislead the persons to whom it is directed (e.g. the consumers); the decisive factor, therefore, is, from which region the consumers expect the goods to come. 2. The Federal Republic of Germany is one of the countries that do not require the protection of an indication of source to be recognized by means of a specific government measure. Under German law, protection of indications of source, inclUding appellations of origin, is implied in the provisions of the Law against Unfair Competition of 17 June 1909 (Reichsgesetzblatt (Reich Law Gazette) p. 499), last amended by the Law of 23 June 1970 (Bundesgesetzbl. I pa 805), which in its Sections 3 and 4 contains a general prohibition of the use of deceptive indications in business activity. The provisions of those Sections, in principle, disallow the use of indieations of source for products not manufactured in the locality or region indicated. The notion of quality which the consumers associate with an indication of source have also to be taken into consideration, because the prohibition in Sections 3 and 4 of the Law against Unfair Competition also extends to deceptive indications in respect of essential characteristics of products. Nearly all German indications of source are protected exclusively on the basis of these general provisions. Special laws ensuring special protection of individual appellations of origin exist in isolated cases only, one of them referring to the appellation "Solingen". The number of judicial decisions is equally limited; such decisions have usually been rendered only in cases where it had been contended that the indication in question had become a generic term. Since the general prohibition contained in Sections 3 and 4 of the Law against Unfair Competition is generally observed it is hardly ever necessary to establish the protection of individual appellations by court decision. Moreover, not all judicial decisions define exactly the boundaries of the region of origin especially in cases where the goods were produced in a locality far away from the said region. Administrative measures establishing the protection of individual appellations do not exist in Germany, with the. exception of the entry of certain appellations for wine in the Weinbergsrolle (roll of vineyards) which might possibly be regarded as such a measure. TAO!I!4 Annex II page 3 Hence, if the Lisbon Agreem~nt remains in its present form, the Federal Republic of Germany, like other countries with a comparable legal situation, could request protection only fOl some few indications of source for which a special act fulfilling the requirements of the Agreement exists, whereas the most widely known German indications of source which as a rule are respected by German competitors, would be excluded from protection under the Lisbon Agreement. 3. For the reasons mentioned, therefore, the Government of the Federal Republic of Germany, in spite of being most interested in international arrangements to strengthen the protection of indications of source, does not ~ee itself in a position to accede to the Lisbon Agreement in its present form. III. 1. The Federal Government would welcome an amendment to the Lisbon Agreement with a view to introducing more flexibility into the conditions of protection and in this context refers to the principles underlying the aforementioned Agreements the Federal Republic of Germany has concluded with France, Italy, Greece, Switzerland and Spain. These agreements contain arrangements in two stages. For one thing, indications of source are reserved to the goods originating in the country in which the regions to which they refer are situated (country of origin). This stipulation prevents indications of source from being used for goods originating in the other contracting State or third States. Moreover, the indications protected under these agreements may not be used in the other contracting State except under the conditions prescribed by the law of the country of origin. This means that the question as to whether a product manufactured in the country of origin may carry the indication of source is governed by the legislation of the country of origin in the other contracting State as well. In this connection, the legal provisions of the country of origin concerning the indications of source listed in the agreements are not specifically mentioned. The agreements only contain the general provision that the law of the country of origin concerning these indications is applicable as a whole. Hence, any amendments to the national legislation do not necessitate amendments to the agreements. In court proceedings, the plaintiff has, if necessary, to submit the text of the legal provisions of the country of origin governing the indication in question. This flexible solution contained in the aforementioned bilateral agreements has in the Federal Government's view proved most valuable in practice. 2. As regards this solution, the mere fact that indications of source will be reserved to products from the country of origin will, in the majority of cases, suffice to prevent these indications from being misused. Only in few cases an application of the substantive provisions of the country of origin governing the protection of the indication concerned will be necessary. Many of the latter cases could be decided without difficulty because most of the indications of source consist of the names of municipalities or political districts with established boundaries. However, it might be difficult for courts in a State other than the country of origin to ascertain the regions for traditional indications of source and the quality standards which, for certain indications of source, are required in the country of origin. 3. In the Federal Government's opinion i t might, therefore be advisable to consider two possible solutions: First, the system of the said bilateral agreements. The difficulties mentioned in connection with that solution would, in the view of the Federal Government, be not too heavy a burden for the courts of the contracting States, because they can ask the plaintiff to submit the applicable law of the country of origin if the goods stem from the country of origin and only the compliance with the requirements of the national law of that country is in dispute. If, however, in the opinion of the interested States such a solution would pose too many problems for their courts - especially regarding the multilateral character of the Agreement and the great number of indications of source which, therefore, might fall under the protection of the Agreement - a second solution might be considered, confining the obligations under the Agreement to a reservation of the indications of source for goods manufactured in the country of origin; all other questions could be left to the national laws of the contracting States concerning misleading indications or to bilateral treaties. TAO/I/4 Annex II p"ge 4 Both solutions would eliminate the obstacles to an accession to the Lisbon Agreement by the Federal Republic and other States with comparable legal systems. Neither solution presupposes that each indication of source is recognized as such in the country of origin and protected in this country by an explicit measure. Moreover, neither solution raises the question of an !lowner" of the indication of source. IV. The Government of the Federal Republic of Germany would be grateful if these thoughts would be taken into consideration in view of a possible revision of the Lisbon Agreement, and offers its active cooperation in further deliberations. LEnd of Annex II/ LEnd of documen!!