Geographical Indications: Progress following the Primary Production Select Committee

Wednesday 5th October 2016

In March 2016, the Geographical Indications (Wine and Spirits) Registration Amendment Bill (“the Bill”) passed its first reading in Parliament. Following the Ministry of Business Innovation and Employment (MBIE) release of the draft Geographic Indications (Wine and Spirits) Registration Regulations 2016 (“the Regulations”) for review and comment (see our article here), the Bill has now proceeded through the Primary Production Select Committee (“the Committee”).

The Committee received submissions from the industry and public on the Bill. While submissions were generally in support of the Bill, the Committee has adopted a few important recommendations for amendment, including changes to oppositions and the initial period of registration.

Submissions were also received to increase the 85% rule (85% of the product must contain wine sourced from the region covered by the GI).  However, this was rejected by the Committee.

Opposition: Grounds and process

The most substantial recommendation involves the opposition grounds and procedures. Unlike the Patents Act 2013 and the Trade Marks Act 2002 where the opposition grounds and procedures are included in the Act, the Geographical Indications (“GI”) opposition grounds and procedures are included in the Regulations.

The Committee recommends that the GI Bill be amended to expressly provide for oppositions, but that the procedures for opposition should remain in the Regulations.

The Committee has also recommended that the “interested person” standard be adopted as a requirement for standing in oppositions or applications to alter or remove a GI.

Initial registration period of five years from the date of registration

The Bill allows for a GI to be registered for a 10 year period, renewable for further periods of 10 years.

The Intellectual Property Office of New Zealand (“IPONZ”) filed submissions stating that from further analysis the ten year renewal period may result in significant shortfall in revenue if application volumes are lower than expected, or if the number of proceedings involving GIs is higher than estimated.

To mitigate this, the Committee recommend that the Bill be amended to provide an initial period of registration of five years. Following this, the registration will be renewable in ten year intervals.

This is in line with the expectation that the costs involved in establishing and maintaining the register are to come from fees.

Increase to the 85% rule?

One submission argued for the 85% rule to be increased to 90% or higher. At present, the Bill’s minimum requirement is that wine labelled with a registered GI must include at least 85% of the wine must made from grapes grown in the area identified by the GI. This is a minimum requirement, rather than an expectation and is the same as the GI registration systems in the EU and Australia.

Overall, the Committee considers that a 90% or higher rule will present no significant advantage, and in some cases a disadvantage. The Committee considers that the current practice among wine producers is that during periods where grape harvests in particular regions are lower than projected and there is a shortfall, the wine producers’ have the ability to blend wine made from grapes grown in other regions. Raising the 85% rule will mean a substantial change in the current practice.

The Bill is now back in Parliament where it will undergo its second reading. We will keep you updated with any further developments. 

This article was written by Rachel McDonald.

This article is intended to summarise potentially complicated legal issues, and is not intended to be a substitute for individual legal advice. If you would like further information, please contact a Baldwins representative.

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