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    Protection Of Geographical Indications In Russia: Is Russian Vodka A Protected GI?

    Published on 31 August 2012 @ 7:49 pm

    By for Intellectual Property Watch

    For those who might be curious, the short answer is yes. For those who might be interested to learn more about the protection of geographical indications (GIs) in Russia, this article provides some insights into the Russian law that might be pertinent in light of Russia’s accession to the World Trade Organization and recent developments in the international GI law.

    More information [in Russian] on Russian vodka as a GI, see here.

    The WTO’s recent announcement on Russia’s formally completed accession is here. It is the 157th member of the WTO.

    What Are the Famous Russian GIs?

    Geographical indications can serve as guideposts for exploring a country’s geography, history, culture, economy; oftentimes, they tell fascinating stories, in which historical facts interweave with legends and myths.

    GIs are unique and country-specific. If someone wishes to see some ‘branded’ Russian GIs, vending tents at touristic spots like Checkpoint Charlie in Berlin can serve the purpose. There, among matryoshka dolls and star-shaped badges, vendors offer intricate decorative art items such as Pavloposadsky shawls or Gzhel porcelain. And, if, nowadays, traditional Russian matryoshka dolls can actually happen to be ‘made in China,’ the Pavloposadsky shawls should be shipped from Pavlovsky Posad and the Gzhel porcelain should be produced in the Gzhelsky region.

    The Subject Matter of Protection under the Russian Law

    The protection of geographical indications is a relatively young field of the intellectual property law in Russia. The first special provisions were introduced in 1992 as a part of the Federal law on ‘Trademarks, Service Marks and Designations of Places of Origin of Goods.’ Prior to that, designations of places of origin of goods had been protected against false or misleading designations under unfair competition and consumer protection laws.

    The present Civil Code of the Russian Federation (CCRF) provides for protection to all kinds of goods including foodstuffs and handicrafts. Article 1516 (1) defines the subject matter of protection as follows:
    A designation of the place of origin of a good, for which protection is accorded, is a designation that constitutes or contains a modern or historical, official or unofficial, full or abbreviated designation of a country, city or a rural settlement, area or other geographical locale, as well as a name derived from such designation, that has become known due to its use with regard to a certain good, the special characteristics of which are exclusively or mainly determined by natural conditions and (or) human factors that are characteristic for that geographical locale.

    From the international law perspective, this definition appears close to the notion of the ‘appellation of origin’ introduced in the Lisbon Agreement for the Protection of Appellations of Origin and their International Registration (1958) (although Russia is not a member of the agreement). Under the Lisbon Agreement, appellation of origin means
    the geographical denomination of a country, region, or locality, which serves to designate a product originating therein, the quality or characteristics of which are due exclusively or essentially to the geographical environment, including natural and human factors” (Article 2 (1)).

    The WTO Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS) employs the term ‘geographical indications’ in reference to
    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” (Article 22 (1)).

    The notion of ‘geographical indication’ appears broader than the ‘appellation of origin’ in two aspects. First, the protection is provided for those goods that derive not only their specific quality or characteristics, but also reputation from the geographical area of production. Second, geographical indications also cover non-geographical signs.

    The issue of the compliance of the Russian law with the TRIPS definition of the subject matter of protection arose during the WTO accession negotiations. As evidenced from the Report of the Working Party on the Accession issued on November 17, 2011 [Accession Report WT/ACC/RUS/70 WT/MIN(11)/2], some members expressed concern, considering that Article 1516 of the CCRF provides a “limited definition of designations of the place of origin of goods” which “did not comply with Article 22 of the WTO TRIPS Agreement.”

    In particular, it was emphasized that pursuant to Article 22 (1) of the TRIPS Agreement, a geographical indication “did not necessarily have to be a geographical place” and it can be “any kind of designation with points to a given country, region or locality and which possesses a specific quality, reputation or other characteristics which were essentially due to a particular geographical environment, but not necessarily the name of a geographical place: it may be a geographical name or an indication that was not a geographical name as long as the indication evokes an association with the place of origin (see Accession Report, §§ 1266 – 1269). These concerns were recognized: in 2010 Article 1516 of the CCRF was supplemented by a paragraph extending the protection for non-geographical designations.

    On the Level of Protection

    One issue currently not harmonized in the international law relates to the level of protection for GIs. The Lisbon Agreement provides for protection against the usurpation or imitation irrespective of the type of goods. The TRIPS Agreement differentiates between the standard and enhanced levels of protection.

    While the standard protection is available for GIs for all types of goods and intends to prevent misleading of the public and unfair competition practices in the meaning of the Article 10bis of the Paris Convention, the enhanced protection is available for GIs for wines and spirits and covers unauthorized uses of GIs even if the public is not misled.

    The question of extending protection for goods other than wines and spirits has been on the WTO agenda as one of Doha negotiation mandates since the Fourth Ministerial Conference in 2001.

    The Russian law provides for the extended protection, i.e., protection against imitation, for all goods. Similar to the language of Article 3 of the Lisbon Agreement, Article 1519 of the CCRF reads:
    The use of a registered designation of the place of origin of a good, even if the true origin is indicated, or if such designation is used in translation, or is accompanied by words such as ‘kind’, ‘type, ‘imitation’ or the like, shall not be allowed.

    It would be interesting to follow on Russia’s participation in further WTO member negotiations on the extension of protection.

    Registration with Rospatent

    The protection of designations of places of origin is based on the registration; records of registered designations are entered and kept in the State Register of Appellations of Origin of the Russian Federation.

    Rospatent, the Russian federal executive authority for intellectual property, is responsible, inter alia, for the application procedure, formal and substantive examination, issuing certificates of registration, and keeping records in the Register.

    As of today, the Register contains 149 entries. Most of the certificates were issued for handicraft goods and mineral water (the database is open; the search system does not allow sorting the results by valid or expired certificates).

    The term of protection runs as long as goods can be produced in a particular geographical area, the natural and/or human factors that determine specific quality or characteristics of such goods. The certificate of registration is issued for 10 years from the date of application and can be prolonged.

    Generic Designations: The Lost Battle of Borodinsky

    Pursuant to Article 1516 (2) of the CCRF, even if a certain indication constitutes or contains a geographical name, but has become a common name as an indication of a good of certain type in the Russian Federation, such designation cannot be protected.

    This definition of generic designations appears consistent with Article 24 (6) of the TRIPS Agreement that stipulates that a member state is not bound to protect indications of goods or services if they are “identical with the term customary in common language as the common name for such goods or services in the territory of that Member.” It is also in line with the EU Council Regulation No. 510/2006 of 20 March 2006 on the protection of geographical indications and designations of origin for agricultural products and foodstuffs that defines generic name as
    the name of an agricultural product or a foodstuff which, although it relates to the place or the region where this product or foodstuff was originally produced or marketed, has become the common name of an agricultural product or a foodstuff in the Community.

    The Lisbon Agreement approaches generic appellations of origin differently, providing for a presumption that, as long as an appellation of origin is protected as an appellation of origin in the country of origin, such appellation cannot “be deemed to become generic” (Article 6).

    An example of a name considered to have become common in Russia and, consequently, non- registrable, would be ‘borodinsky’ – a type of rye bread, which ingredients traditionally include coriander, refined sugar syrup, and a special type of rye malt. It derives its name from Borodino, a name of a settlement about 125 km west from Moscow, where the famous battle of 1812 between Kutuzov and Napoleonic troops took place. According to one legend, the bread was baked by nuns of a convent situated near Borodino; according to another, the recipe was invented by a wife of a general, who fought in the war of 1812. As a side note, earlier this August, a monument to Borodinsky bread was opened in the Smolensk region. Borodinsky has been produced in Moscow since 1920s. Neither its characteristics nor specific taste qualities can be attributed to the place that gives its name.

    On Enforcement: A Spoon of Tar in a Barrel of Honey

    Russian law provides for the following remedies for infringement of rights for registered designations of places of origin. The right holder can demand that the counterfeit goods, labels, and packaging bearing the designation of the place of origin or confusingly similar designations without authorization, are withheld from commerce and destroyed at the infringer’s expense. The right holder can decide whether to demand payment of damages or compensation that can either (1) range between 10,000 and 5,000,000 rubles (approximately US$300 and $160,000) to be decided by the court; or (2) be calculated as the double value of infringing goods (Article 1537 of the CCRF).

    Recently, a dispute arose over Bashkirsky honey, a protected designation for the honey produced in the Republic Bashkortostan. The right holder, the scientific research centre for beekeeping and apiotherapy in Ufa (the capital of Bashkortostan), claimed the maximum compensation of 5,000,000 rubles for the unauthorized use of ‘Bashkirsky honey’ designation. In ruling in favour of the plaintiff, the Commercial court of the Moscow region applied the following remedies: the counterfeit products were ordered to be withdrawn from commerce and destroyed, and the compensation was determined in the amount of 100,000 rubles (approximately US$3,143). (The commercial appeal court of Moscow affirmed the decision [in Russian].)

    Protection of Foreign GIs under the Russian Law

    Formerly, the Federal law of 1992 ‘On Trademarks, Service Marks and Designations of Places of Origin of Goods’ stipulated the principle of reciprocity with regard to the protection of foreign designations, i.e., legal entities and natural persons of a foreign country had the right to register designations of the places of origin in the territory of the Russian Federation only if the analogous right was available for the legal entities and natural persons of the Russian Federation in such a country.

    Later on, this requirement was abolished. Under the current law, foreign right holders can acquire protection via registration with Rospatent if a geographical indication in question is granted protection as a GI in the country of origin. A question might arise in this respect: what if a foreign country does not provide a sui generis regime for GIs, but, for instance, protects them under the trademark law?

    Currently, among foreign designations of places of origin protected in the territory of Russia are: Romanian wine Murfatlar, Italian wine Asti, Italian ham Prosciutto di Parma, and Karlsbader Bitter.

    On the Interplay between GIs and Trademarks

    Both trademarks and GIs serve the purpose of individualization of goods. In case of identical or similar trademark and GI, the TRIPS Agreement provides an exception that allows a senior trademark to survive under certain circumstances (Article 24 (5)).

    During the WTO accession negotiations some members expressed concerns that the Civil Code of the Russian Federation did not provide adequate protection for rights in trademarks when the registration of geographical indications would be confusingly similar to the registered mark (see § 1263 of the Accession Report). As a matter of fact, Article 1252 (6) of the CCRF establish the principle of seniority with regard to the protection for different means of individualization that are identical or confusingly similar; in particular, the provision states that “if different means of individualization are identical or confusingly similar so that they can mislead a customer or a contracting party, the means of individualization with the earlier-in-time right shall prevail.” The provision explicitly lists trademarks, service marks, commercial names and commercial designations as such means of individualization; it appears not quite clear if this list is exhaustive and if designations of places of origin can be regulated under this provision.

    In response to the WTO members’ concerns, the representative of the Russian Federation stated that
    “registration would not be granted to a designation of the place of origin of goods, inter alia, where, in light of the reputation and renown of a trademark and the length of time it had been used, registration of the designation of the place of origin of goods was liable to mislead the consumer as to the true identity of the product and therefore to create a likelihood of confusion with an earlier-in-time trademark.” (See §1264 of the Accession Report).

    Currently, the existence of a previously registered trademark is not expressly mentioned as a ground for refusal of an application for a designation of the place of origin during the substantive examination (Article 1525 of the CCRF). At the same time, if the use of a designation of a place of origin can confuse the consumer as to the good or its producer because of the existence of a trademark with the earlier priority date, the right for such designation can be contested and invalidated within 5 years after the publication of the registered designation of a place of origin in the official bulletin (Article 1536 of the CCRF). It can be assumed that if there is no likelihood of confusion, the younger right for the designation shall survive. From the viewpoint of the legal efficacy, it appears justifiable that during the substantive examination a designation of the place of origin is examined as to a latent conflict with rights in earlier trademarks and, thus, the there is a viable possibility that such registration will later subject to invalidation.

    As was previously reported (IPW, WTO/TRIPS, 12 July 2012), Russia is presently amending its Civil Code.

    In relation to the above-mentioned concerns of the WTO members, the draft amendments introduce the rule that after the publication of the application for registration anybody can object to the registration and submit in writing to Rospatent facts against the registration; such facts shall be taken into account during the application examination. The draft amendments [in Russian] are now undergoing the second reading in the Russian State Duma and expected to be enacted in February-March 2013.

    The following case can illustrate the interplay between trademark and designation of the place of origin under the Russian law. The dispute arose between two breweries: Budejovicky Budvar and Anheuser-Busch over the Russian market for Budweiser beer.

    The history of the Budweis beer production dates back to the XIII century. Originally, it was produced in the city of Budweis located in the historical province of Bohemia, the southern part of the contemporary Czech Republic (České Budějovice in Czech). The successor of the historical tradition of brewing of beer in that area is the Budejovicky Budvar brewery. In the mid-1800s, immigrants from Germany and Bohemia started producing Budweiser beer in the United States. As the successor of the brewing tradition of Budweiser beer, the Anheuser-Busch company was established in St. Louis, Missouri.

    Since the beginning of the 19th century, the legal battle between the two breweries regarding the use of ‘Budweiser’ have been continuing over different markets and in different jurisdictions (see the recent decision of the ECJ as of 22 September, 2011 in Case C482/09). As far as the US market is concerned, nowadays, Budejovicky Budvar beer is sold there under the CZECHVAR trademark.

    In the context of the companies’ competition in the Russian market, the legal dispute arose in 1989, when Anheuser-Busch applied for registration of the ‘Bud’ trademark for beer with the Russian Patent and Trademark Office. Later that year, Budejovicky Budvar applied for the trademark registration too, but the application was refused based on the priority principle. Subsequently, Budejovicky Budvar applied for protection as an appellation of origin and the granted registration precludes Anheuser-Busch from obtaining the trademark protection. Anheuser-Busch appealed the decision of Rospatent, arguing that ‘Bud’ is not a designation of a geographical place. The action was successful, and in 2001 Rospatent issued the annulment of Budweiser Budvar’s registration for ‘Bud’ and registered Budejovicky Budvar’s trademark.

    As the decisive argument, the Appeal Chamber stated that a designation of the place of origin “has to be a geographical name, or its derivative,” while “the contested designation ‘Bud’ is not present in the territory of the Czech Republic, neither is it a historical designation of a geographical locale.”

    Interestingly, under the Lisbon Agreement (although, as discussed above, it adopts the ‘narrow’ approach), nevertheless, ‘Bud’ was registered as the appellation of origin in 1975.

    In Russia, Budejovicky Budvar holds, for the time being, certificates of registration for the following designations of places of origin: BUDEJOVICKE PIVO, CESKOBUDEJOVICKE PIVO, BUDEJOVICKE PIVO – BUDVAR, and BUDEJOVICKE BUDVAR.

    Protection of Russian Vodka

    On Russian vodka, presently, several right holders possess certificates of registration, according to the records of the Rospatent Register. The geographical area that is believed to give the product its specific characteristics, as stated in the certificate, comprises not less than the state borders of the Russian Federation. At the same time, the USPTO database contains the record of trademark registration for ‘Russkaya Russian Vodka’ (filed for registration in 2005); the trademark owner – AL MAIDAN ALCO FZE Corporation United Arab Emirates.

    An interesting question might be whether, in light of the exceptions provided in Article 24 of the TRIPS Agreement, the Russian right holders can contest the validity of the UAE trademark and whether such action might prove successful.

    Ms. Daria Kim (Russia), a researcher with Intellectual Property Watch, holds an LL.M. degree in Intellectual Property and Competition Law from Munich Intellectual Property Law Center. She specializes in copyright management and has been working for art and non-profit organizations, such as Eifman Ballet Theater and the Farukh Ruzimatov Foundation ‘The Reneissance of the Ballet Art’.

    Daria Kim may be reached at info@ip-watch.ch.

     


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