WT/DS174/R/Add.2 
 Page B-1 
 
 
 ANNEX B 
 
SUBMISSIONS BY THE EU ROPEAN COMMUNITIES 
 
 
Contents Page 
Annex B-1 European Communities' Request for a Preliminary Ruling 
(24 February 2004) 
 B-2 
Annex B-2 First Written Submission of th e European Communities (25 May 2004) 
 B-20 
Annex B-3 Oral Statement of the European Communities – First Substantive 
Meeting (23 June 2004) 
 B-107 
Annex B-4 Replies by the European Comm unities to Questions posed by the Panel 
following the First Substantive Meeting (8 July 2004) 
 B-121 
Annex B-5 Second Written Submission of the European Communities 
(22 July 2004) 
 B-164 
Annex B-6 Oral Statement of the Eur opean Communities – Second Substantive 
Meeting (11 August 2004) 
 B-238 
Annex B-7 Replies by the European Comm unities to Questions posed by the Panel 
following the Second Substantive Meeting (26 August 2004) 
 B-288 
Annex B-8 Replies by the European Comm unities to Questions posed by Australia 
following the Second Substantive Meeting (26 August 2004) 
 B-347 
Annex B-9 Comments of the European Communities on Australia's and the 
United States' Replies to Questions posed by the Panel following the 
Second Substantive Meeting (2 September 2004) 
 B-351 
Annex B-10 Comments of the European Communities on the Reply of the 
International Bureau of WIPO to the Panel's Letter of 9 July 2004 (28 September 2004) 
 B-376 
 WT/DS174/R/Add.2 
Page B-2  
 
 ANNEX B-1 
 
EUROPEAN COMMUNITIES' REQUEST FOR A PRELIMINARY RULING 
 
(24 February 2004) 
 
 
TABLE OF CONTENTS 
 
I. INTRODUCTION ................................................................................................................... ....................4  
II. THE REQUIREMENTS OF ARTICLE 6.2 DSU.....................................................................................4  
A. THE CONTENT AND PURPOSE OF ARTICLE 6.2 DSU................................................................................4  
B. THE PANEL MUST NOT ASSUME JURISDICTION IN RESPECT OF CLAIMS THAT HAVE NOT BEEN 
ESTABLISHED IN ACCORDANCE WITH ARTICLE 6.2 DSU........................................................................5  
C. THE REQUIREMENTS OF ARTICLE 6.2 DSU  MUST BE EVALUATED ON THE FACE OF THE PANEL 
REQUEST ............................................................................................................................... .................6  
III. THE PANEL REQUESTS FAIL TO IDENTIFY THE "SPECIFIC MEASURE AT ISSUE"............6  
A. THE REFERENCES TO REGULATION 2081/92  ARE NOT SUFFICIENTLY SPECIFIC .......................................6  
B. THE REFERENCES TO "RELATED IMPLEMENTING AND ENFORCEMENT MEASURES " ARE NOT 
SUFFICIENTLY SPECIFIC ..........................................................................................................................8  
IV. THE PANEL REQUESTS DO NOT CONTAIN A BRIEF SUMMARY OF THE LEGAL 
BASIS OF THE COMPLAINT ......................................................................................................... .......10  
A. THE BRIEF SUMMARY OF THE LEGAL BASIS OF THE COMPLAINT ...........................................................10  
B. THE PANEL REQUESTS FAIL TO "PRESENT THE PROBLEM CLEARLY ".....................................................11  
1. The United St ates request...................................................................................................... ...11 
(a) The United States request does not indi cate the legal base s of the claims..........................................11  
(b) The United States claims are unclear........................................................................................... .......12  
2. The Australia n request ......................................................................................................... ....13 
(a) The legal bases of the claims indicated in the Australian request are in some cases unclear..............14  
(b) The Australian clai ms are unclear .............................................................................................. ........15  
V. THE DEFICIENCIES OF TH E PANEL REQUESTS RESULT IN SERIOUS PREJUDICE 
FOR THE EUROPEAN COMMUNITY AS A DEFENDANT .............................................................16  
VI. THE DEFICIENCIES OF THE PANEL REQUESTS HAVE BEEN  RAISED BY THE EC IN 
A TIMELY MANNER, AND MUST BE  ADDRESSED WITHOUT DELAY ....................................17  
VII. CONCLUSION ..................................................................................................................... .....................19  
  WT/DS174/R/Add.2 
 Page B-3 
 
 
  
Short Title Full Case Title and Citation of Case 
Canada – Wheat Preliminary Ruling of the Panel, Canada – Measures Relating to Exports of Wheat 
and Treatment of Imported Grain , WT/DS276/12, circulated on 21 July 2003 
EC – Bananas III  Appellate Body Report, European Communities – Regime for the Importation, Sale 
and Distribution of Bananas , WT/DS27/AB/R, adopted 25 September 1997 
Guatemala – 
Cement I  Appellate Body Report, Guatemala – Anti-Dumping Investigation Regarding Portland 
Cement from Mexico , WT/DS60/AB/R, adopted 25 November 1998 
Korea – Dairy  Appellate Body Report, Korea – Definitive Safeguard Measure on Imports of Certain 
Dairy Products , WT/DS98/AB/R, adopted 12 January 2000 
Thailand – 
H-Beams  Appellate Body Report, Thailand – Anti-Dumping Duties on Angles, Shapes and 
Sections of Iron or Non-Alloy Steel and H-Beams from Poland , WT/DS122/AB/R, 
adopted 5 April 2001 
US – Carbon Steel from Germany Panel Report, United States – Countervailing Duties on Certain Corrosion-Resistant 
Carbon Steel Flat Products from Germany , WT/DS213/R and Corr.1, adopted 
19 December 2002 
Appellate Body Report, United States – Countervailing Duties on Certain 
Corrosion-Resistant Carbon Steel Flat Products from Germany , WT/DS213/AB/R, 
adopted 28 November 2002 
US – FSC  Appellate Body Report, United States – Tax Treatment for "Foreign Sales 
Corporations" , WT/DS108/AB/R, adopted 20 March 2000 
US – Lamb  Panel Report, United States – Safeguard Measures on Imports of Fresh, Chilled or 
Frozen Lamb Meat from New Zealand and Australia , WT/DS177/R, WT/DS178/R, 
adopted 16 May 2001 
 WT/DS174/R/Add.2 
Page B-4  
 
 I. INTRODUCTION 
1. The European Communities (hereinafter "the EC ") is of the view that the requests for the 
establishment of the Panel made by Australia (hereinafter: Australian request)
1 and by the United 
States (hereinafter: United States request)2 do not meet the requirements of Article 6.2 of the Dispute 
Settlement Understanding (DSU). 
 
2. The Panel requests fail to identify the speci fic measure at issue in the present dispute. 
Moreover, the Panel requests do not provide a brie f summary of the legal basis of the complaint 
sufficient to present the problem clearly.  
3. The respect of the requirements of Article  6.2 DSU is an essential precondition for the 
jurisdiction of a Panel. Where a complaining party ha s failed to clearly set out its claim in accordance 
with Article 6.2 DSU, the Panel does not have jurisdiction.  4. Moreover, the deficiencies of the Panel requ ests seriously prejudice the due process rights of 
the EC as a defending party. As a defending party,  the EC is entitled to know the case it has to 
answer. The Panel requests in the present case do not meet the minimum requirements necessary for ensuring a fair and orderly conduct of  the dispute settlement proceedings. 
 5. Given these fundamental concerns, the EC requ ests that the Panel issue a preliminary ruling 
regarding Article 6.2 DSU. 
 
II. THE REQUIREMENTS OF ARTICLE 6.2 DSU 
6. Article 6.2 DSU sets out the following minimu m requirements with which any Panel request 
must comply:  
The request for the establishment of a panel shall be made in writing.  It shall indicate 
whether consultations were he ld, identify the specific measu res at issue and provide a 
brief summary of the legal basis of the complaint sufficient to present the problem 
clearly. 
A. T
HE CONTENT AND PURPOSE OF ARTICLE 6.2 DSU 
7. In Korea – Dairy , the Appellate Body held that Article 6.2 of the DSU imposes four separate 
requirements:3 
 
When parsed into its constituent parts,  Article 6.2 may be seen to impose the 
following requirements.  The request must:  (i)  be in writing;  (ii)  indicate whether consultations were held;  (iii)  identify th e specific measures at issue;  and  (iv)  
provide a brief summary of the legal basis of the complaint sufficient to present the 
problem clearly.  In its fourth requirement, Article 6.2 demands only a summary – and it may be a brief one – of the legal basis of the complaint;  but the summary must, in any event, be one that is "sufficient to present the problem clearly".  It is not 
enough, in other words, that "the legal basis of the complaint" is summarily identified;  the identification must  "present the problem clearly". 
                                                     
 
1 Request of 18 August 2003, WT/DS290/18. 
2 Request of 18 August 2003, WT/DS174/20. 
3 Appellate Body Report, Korea –Dairy, para. 120.  WT/DS174/R/Add.2 
 Page B-5 
 
 
 8. The objective and purpose of Article 6.2 of th e DSU is to guarantee a minimum measure of 
procedural fairness throughout the proceedings. This is  of particular importance to the defendant, who 
must rely on the Panel request in order to begin preparing its defense. Similarly, WTO Members who 
intend to participate as third parties must be info rmed of the subject-matter of the dispute. This 
underlying rationale of Article 6.2 DSU has been explained by the Appellate Body in Thailand - H-
Beams :4 
 
Article 6.2 of the DSU calls for sufficient clar ity with respect to the legal basis of the 
complaint, that is, with respect to the "claims" that are being asserted by the complaining party. A defending party is entitled to know what case it has to answer, 
and what violations have been alleged so  that it can begin preparing its defence.  
Likewise, those Members of the WTO who intend to participate as third parties in panel proceedings must be informed of the legal basis of the complaint.  This requirement of due process is fundamental to  ensuring a fair and orderly conduct of 
dispute settlement proceedings. 
B. T
HE PANEL MUST NOT ASSUME JURISDICTION IN RE SPECT OF CLAIMS T HAT HAVE NOT BEEN 
ESTABLISHED IN ACCORDANCE WITH ARTICLE 6.2 DSU   
9. Moreover, the respect of the requirements of  Article 6.2 DSU is of crucial importance for 
properly establishing the jurisdiction of the Pane l. As the Appellate Body has confirmed in US – 
Carbon Steel , the panel request forms the basis of the pa nel’s terms of referen ce under Article 7.1 of 
the DSU:5 
 
There are, therefore, two distinct requirements, namely identification of  the specific 
measures at issue ,  and the provision of a  brief summary of the  legal basis of the 
complaint   (or the  claims ).  Together, they comprise the "matter referred to the 
DSB", which forms the basis for a panel's te rms of reference under Article 7.1 of the 
DSU. 
10. For this reason, a strict respect of the re quirements of Article 6.2 DSU is essential for the 
orderly conduct of dispute settleme nt proceedings under the DSU. As the Appellate Body has clearly 
stated in EC – Bananas , Panels must therefore verify carefully that the conditions or Article 6.2 DSU 
are fulfilled:6 
 
As a panel request is normally not subjected  to detailed scrutiny by the DSB, it is 
incumbent upon a panel to examine the re quest for the establishment of the panel 
very carefully to ensure its compliance with  both the letter and the spirit of Article 6.2 
of the DSU.  It is important that a panel request be sufficiently precise for two reasons:  first, it often forms the basis for th e terms of reference of the panel pursuant 
to Article 7 of the DSU;  and, second, it informs the defending party and the third 
parties of the legal basis of the complaint. 
11. Accordingly, the present Panel must verify  carefully that the Panel request meet the 
requirements of Article 6.2 DSU. The Panel must not assume jurisdiction over any claim that has not been set out in accordance with Article 6.2 DSU. 
                                                     
 
4 Appellate Body Report, Thailand – H Beams , para. 88 (emphasis added). Similarly Appellate Body 
Report, US – Carbon Steel , para. 126. 
5 Appellate Body Report, US – Carbon Steel , para. 125. Similarly, Appellate Body Report, Guatemala 
– Cement , para. 72. 
6 Appellate Body Report, EC – Bananas III , para. 142 (emphasis added).  Similarly also Appellate 
Body Report, US – Carbon Steel , para. 126. WT/DS174/R/Add.2 
Page B-6  
 
  
C. T
HE REQUIREMENTS OF ARTICLE 6.2 DSU  MUST BE EVALUATED ON THE FACE OF THE PANEL 
REQUEST  
12. In EC – Bananas , the Appellate Body has clarified that the claims, which are set out in the 
panel request, must be distinguished from the subseq uent arguments of the parties in support of their 
claim. Consequently, the Appellate Body has held th at a faulty Panel request cannot be subsequently 
"cured" by the written submission of the parties:7 
 
We do not agree with the Panel that "even if there was some uncertainty whether the panel request had met the requirements of Ar ticle 6.2, the first written submissions of 
the Complainants ‘cured’ that uncertainty because their submissions were sufficiently 
detailed to present all the factual and lega l issues clearly". Article 6.2 of the DSU 
requires that the claims , but not the arguments , must all be specified sufficiently in 
the request for the establishment of a panel in order to allow the defending party and 
any third parties to know the legal basis of the complaint.  If a claim  is not specified 
in the request for the establishment of a panel, then a faulty request cannot be 
subsequently "cured" by a complaining pa rty's argumentation in its first written 
submission to the panel or in any other su bmission or statement made later in the 
panel proceeding. 
13. As a consequence, the only basis on whic h to establish whether a Panel request is in 
conformity with the requirements of Article 6.2 is  the text of the request itself. This has been 
confirmed by the Appellate Body in United States - Carbon Steel :
8 
 
As we have said previously, compliance with  the requirements of Article 6.2 must be 
demonstrated on the face of the request  for the establishment of a panel.  Defects in 
the request for the establishment of a pane l cannot be "cured" in the subsequent 
submissions of the parties during the panel proceedings.   
III. THE PANEL REQUESTS FAIL TO IDENTIFY THE "SPECIFIC MEASURE AT 
ISSUE" 
14. Both Panel requests identify the measure at issue as Council Regulation (EEC) No. 2081/92 
on the protection of geographical indications and desi gnations of origin for agricultural products and 
foodstuffs, as amended (hereinafter : Regulation 2081/92). Moreover, the Australian request, in its 
fourth paragraph, defines the "EC measure" as also  including "related implementing and enforcement 
measures". In the view of the EC, these references are insufficient in order to define the "specific 
measure at issue", as required by Article 6.2 DSU.  A. T
HE REFERENCES TO REGULATION 2081/92  ARE NOT SUFFICIENTLY SPECIFIC  
15. The EC considers that the references to Re gulation 2081/92 are not sufficiently specific to 
permit an identification of the "specific me asure at issue" in the present dispute. 
 16. The EC would like to stress that Article 6. 2 DSU requires not only the identification of a 
"measure", but of the "specific
 measure at issue". The wording of Article 6.2 DSU is different from 
that of Article 4.4 DSU, which provides that cons ultation requests must identify "the measures at 
                                                      
7 Appellate Body Report, EC – Bananas III , para. 143. 
8 Appellate Body Report, United States –Carbon Steel , para. 127 (emphasis added).  WT/DS174/R/Add.2 
 Page B-7 
 
 
 issue". As the Panel in Canada – Wheat  has convincingly explained, th is difference in wording is 
intentional, and must be given meaning:9 
 
Having regard to the relevant context of Ar ticle 6.2 of the DSU, we note Article 4.4 
of the DSU, which deals with the contents of requests for consultations.  It states in 
relevant part that "any request for consulta tions shall give the reasons for the request, 
including identification of the measures at i ssue".  Notably, Article 4.4 omits the term 
"specific" in referring to the "measures at i ssue".  We believe that this difference in 
language is not inadvertent and must be gi ven meaning.  Indeed, in our view, this 
difference in language supports the view that  requests for consultations need not be as 
specific and as detailed as requests for estab lishment of a panel under Article 6.2 of 
the DSU.  As a corollary, in our view, this relevant context bears out the importance of the term "specific" as it appears in Article 6.2. 
17. In the view of the EC, what can be consid ered a "specific measure" will depend on the 
circumstances of the particular case, and in pa rticular on the characteristics of the measure in 
question. Where a measure is of a relatively si mple character, or where it is clear from the 
circumstances of the case which aspect of the measure is contested, it may be sufficient to refer to the 
measure as a whole and identify it by name, number, or date of adoption.  18. However, such a reference to a "measure" as a whole may not always be sufficient to establish the "specific measure at issue". This is th e case, in particular, where the measure in question 
is a complex legislative text. For instance, it w ould not seem conceivable to the EC that a WTO 
member would refer, in a request for the establishment of a Panel, simply to the Civil Code of another 
member, without specifying which specific provision is at issue in the dispute. Accordingly, in the case of complex legislative measures, it will not be su fficient to refer to the measure as a whole, but it 
will be necessary to identify the specific provisions or sections of the measure which are at issue. 
 
19. In the present case, Regulation 2081/92 is a measure with establishes the legal framework for 
the protection of geographical indications and desi gnations of origin for agricultural products and 
foodstuffs in the European Community. The text of  Regulation 2081/92, as most recently amended by 
Council Regulation (EC) no. 806/2003 of 14 April 2003, is attached as Exhibit EC–1.  
20. The EC does not propose to describe in de tail the content of Regulation 2081/92 in the 
context of the present request for a preliminary ruli ng. However, the EC believes that even a cursory 
study of Regulation 2081/92 will confirm that this re gulation is a complex piece of legislation in the 
field of the protection of intellectual property. As is typical for such legislation, Regulation 2081/92 
deals with a host of issues relating to all aspects of the protection of geographical indications and 
designations of origin for agri cultural products and foodstuffs. 
 21. The text of Regulation 2081/92 extends over 15 pages, including two annexes. The 
operational provisions of Regulation 2081/92 are contai ned in 22 Articles, each of which in turn is 
subdivided into numerous further pa ragraphs and sections. These articles deal with a host of widely 
differing issues. Purely for illustrative purposes, and without any claim to being exhaustive or 
particularly detailed, the following topics are dealt with in Regulation 2081/92: 
 
• The objective and scope of applicati on of the regulation (Article 1); 
• definitions (Article 2); 
• exclusion from registration of names, and in  particular the issue of generic names 
(Article 3); 
                                                     
 
9 Preliminary Ruling by the Panel, Canada – Wheat , para. 15. WT/DS174/R/Add.2 
Page B-8  
 
 • product specifications (Article 4); 
• the right to apply for registrations and th e procedure for applications (Article 5); 
• the procedures for registration of geographical indications and related issues; the issue of 
homonymous names (Article 6); 
• objections to registrations (Article 7); 
• conditions for the use of geographical indicati ons and designations of origin (Article 8); 
• the amendment of product specifications (Article 9); 
• inspection procedures (Article 10); 
• procedures in case product specifications are not respected (Article 11); 
• cancellation of protected names (Article 11a); 
• the application of the regulation to agri cultural products and foodstuffs from third 
countries (Article 12); 
• the application procedure for the protection of third country geographical indications 
(Article 12a); 
• the registration procedure for the protection of third country geographical indications 
(Article 12b); 
• the amendment of the product specifications for third country geographical indications 
(Article 12c); 
• objections to the registration of geographical  indications emanating from third countries 
(Article 12d); 
• the protection of registered names (Article 13); 
• certain questions regarding the relations hip between geographical indications and 
trademarks (Article 14); 
• the Committee assisting the Commission (Article 15); 
• implementing rules (Article 16); 
• entry into force (Article 18). 
 
22. The unspecific reference to "Regulation 2081/ 92" made in the Panel requests does not permit 
the EC to understand which specific aspects am ong those covered by Regulation 2081/92 the 
complainants intend to raise in the context of the present proceedings. This appears particularly 
objectionable given the fact that it would have been  easily possible for the complainants to provide 
more specific references to individua l provisions of Regulation 2081/92. 
 
23. For these reasons, the EC submits that the re ferences to "Regulation 2081/92" do not meet the 
requirement of the identification of the "speci fic measure at issue" in Article 6.2 DSU. 
 B. T
HE REFERENCES TO "RELATED IMPLEMENTING AND ENFORCEMENT MEASURES " ARE NOT 
SUFFICIENTLY SPECIFIC  
24. In the fourth paragraph of its Panel request, Australia has referred to "related implementing 
and enforcement measures" as part of the "EC measure".10 The EC is of the view that this blanket 
reference to "related implementing and enforcement measures" falls short of the requirement to identify the "specific measure at  issue" in Article 6.2 DSU. 
 
25. The requirement to identify th e "specific measure at issue" m eans that if the measure is not 
already identified beyond reasonable doubt through elements such as name, number, or date of 
                                                     
 
10 In this context, the EC notes that whereas the United States amended request for consultations 
(WT/DS174/1/Add.1), in its second paragraph,  included a reference to "related implementing and enforcement 
measures", such a reference no longer appears in the Panel request, which, in its third and fourth paragraph, refers exclusively to "Regulation 2081/92". Accordingly, the EC understands that the United States Panel 
request extends only to Regulation 2081/92.  WT/DS174/R/Add.2 
 Page B-9 
 
 
 adoption of the act, then the Panel request must at  the very least contain the necessary information 
which enables the Panel, the defendant, and th e third parties to establish with full certainty  which is 
the specific measure at issu e in the present dispute. This has been convincingly stated by the Panel in 
Canada – Wheat :11 
 
We consider that in the absence of an exp licit identification of a measure of general 
application by name, as in the present case, sufficient information must be provided in the request for establishment of a panel it self that effectively identifies the precise 
measures at issue.  Whether sufficient information is provided on the face of the panel request will depend, as noted above, on whether the information provided serves the 
purposes of Article 6.2, and in particul ar its due process objective, as well as the 
specific circumstances of each case, including  the type of measure that is at issue. 
26. As the Panel in Canada – Wheat also explained, due process does not allow the complainant 
to shift the burden of identifying the speci fic measures under challenge to the defendant:
12 
 
Due process requires that the complaining party fully assume the burden of 
identifying the specific measures under cha llenge.  In the present case, the panel 
request effectively shifts part of that  burden onto Canada as the responding party, 
inasmuch as it leaves Canada little choice, if  it wants to begin preparing its defence, 
but to undertake legal research and exercise judgement in order to establish the precise identity of the laws and regulatio ns implicated by the panel request. 
27. The Australian request falls entirely shor t of these requirements. The Australian request 
contains no elements to identify the "measures" at issu e, other than they are "related" and that they are 
supposed to be "enforcement or implementing measures".  28. The statement that the measures are "related" is so vague that it does not permit any 
meaningful narrowing-down of the measures in ques tion. In fact, a whole range of legislative and 
other measures might be considered to be "related " in some way to the present dispute, including 
trademark and other intellectual property legisla tion, unfair competition laws, law on food labelling 
and food marketing, or consumer pr otection laws. Moreover, such laws may exist at the level of both 
the European Community and its Member States.  
29. Similarly, the reference to "enforcement or implementing measures" does not provide the 
required precision with respect to the definition of  the specific measure at issue. Since Regulation 
2081/92 is a complex piece of intellectual property legisl ation, there is very large number of different 
measures that are necessary for its implementation and enforcement.  
30. First of all, implementation may occur throug h legislative measures, for instance through the 
adoption of "detailed rules" on the basis of Artic le 16 of Regulation 2081/92. More importantly, 
implementation and enforcement ma y require measures of the executive, for instance concerning the 
transmission of applications or objections, the decision to register or to cancel geographical 
indications, or to amend specifications, etc. Fi nally, implementation and enforcement is also a 
responsibility of the judiciary, which is responsible  for the judicial review of the actions of the 
Community and Member States authorities in the application  of Regulation 2081/92. 
 31. Moreover, it should be noted that the implem entation of Regulation 2081/92 is not only the 
responsibility of the Community, but also that of its Member States, who, for instance, are responsible 
for the transmission of applications and objectio ns regarding the registration of geographical 
                                                     
 
11 Preliminary Ruling by the Panel, Canada – Wheat , para. 20. 
12 Preliminary Ruling by the Panel, Canada – Wheat , para. 24. WT/DS174/R/Add.2 
Page B-10  
 
 indications to the Commission. Therefore, Member St ates also may have to adopt implementing rules, 
and take decisions which are subject to  judicial review by national courts. 
 32. Finally, it should be noted that the measure s which have been taken for implementing or 
enforcing Regulation 2081/92 are of a very high numbe r. To take only one figure, the EC has by now 
registered 640 geographical indications or desi gnations of origin. The EC would consider it 
inconceivable that each one of these registrations  would be the subject of the present dispute 
settlement proceedings simply because of the blan ket reference to "implementing and enforcement 
measures".   
33. For these reasons, the EC submits that the reference to "related implementing and 
enforcement measures" in the Australian request fa ils to identify the "specific measure at issue". 
 
IV. THE PANEL REQUESTS DO NOT CO NTAIN A BRIEF SUMMARY OF THE 
LEGAL BASIS OF THE COMPLAINT 
34. The Panel requests in the present case do not only fail to identify the specific measure at 
issue. They also fail to include a brief su mmary of the legal basis of the complaint. 
 A. T
HE BRIEF SUMMARY OF THE LE GAL BASIS OF THE COMPLAINT  
35. Article 6.2 DSU requires that a request for the establishment of a Panel must contain a "brief 
summary of the legal basis of the complaint sufficient to present the problem clearly".  
 
36. As the Appellate Body has stated in EC – Bananas , there is a distinction between the claims, 
which must be contained in the Panel request, and the arguments supporting these claims, which are 
set out in the subsequent submissions of the Parties.13 However, in Korea – Dairy , the Appellate Body 
has also clarified that the mere listing of provisi ons claimed to have been violated may not be 
sufficient for the purposes of Article 6.2 DSU:14 
 
Identification of the treaty provisions claimed to have been violated by the respondent 
is always necessary both for purposes of defining the terms of reference of a panel and for informing the respondent and the th ird parties of the claims made by the 
complainant;  such identification is a minimu m prerequisite if the legal basis of the 
complaint is to be presented at all.  But it may not always be enough.  There may be 
situations where the simple listing of the articles of the agreement or agreements 
involved may, in the light of attendant circ umstances, suffice to m eet the standard of 
 clarity   in the statement of the legal basis of the complaint.  However, there may also 
be situations in which the circumstances are such that the mere listing of treaty 
articles would not satisfy the standard of Article 6.2.  This may be the case, for 
instance, where the articles listed establish not one single, distinct obligation, but 
rather multiple obligations.  In such a situa tion, the listing of articles of an agreement, 
in and of itself, may fall short of the standard of Article 6.2. 
37. In the concrete case, the Appellate Body was primarily concerned with the question of 
whether a reference to a provision in a WTO ag reement may be sufficient when such provision 
contains multiple obligations. However, the finding s of the Appellate Body are of a more general 
importance. First, the Appellate Body held that  the precise identification of the WTO provisions 
alleged to have been violated is always require d under Article 6.2 DSU. Second, the Appellate Body 
has also stated that the identification of treaty provisions may not be enough
  to state the problem 
                                                      
13 Appellate Body Report, EC – Bananas III , para. 141. 
14 Appellate Body Report, Korea – Dairy , para. 124.  WT/DS174/R/Add.2 
 Page B-11 
 
 
 clearly. In other words, the identification of the tr eaty provisions alleged to have been violated is a 
necessary, but not a sufficient condition  under Article 6.2 DSU. 
 38. It is this second element whic h is of particular interest in the present case. Article 6.2 DSU 
does not require complainants to "to list the treaty prov isions alleged to have been violated". Rather, it 
obliges complainants to provide a "brief summary of  the legal basis of the complaint sufficient to 
present the problem clearly". The reference to treaty provisions is only one element of the "legal basis 
of the complaint", which must also include other factual and legal elements necessary to present the 
problem clearly.  
B. T
HE PANEL REQUESTS FAIL TO "PRESENT THE PROBLEM CLEARLY " 
39. In the view of the EC, the Panel requests do not establish the problem clearly in accordance 
with Article 6.2 DSU. Even a cursory examination of the Panel requests will show that the "summary 
of the legal basis of the complaint" provided in them is in fact limited to vague listings of articles and 
some narrative text which, in general, is limited to restating the language of the treaty provision in 
question. As the EC will show, by adopting such  a minimalist approach, both the United States and 
the Australian request fail to present the problem  clearly in accordance with Article 6.2 DSU. 
 
1. The United States request 
40. The United States request is drafted in an extremely minimalist way. The "claims" of the 
United States seem to be contained in the third para graph of the United States request. In this short 
paragraph, the United States appears to raise seven  claims with respect to Regulation 2081/92. In 
particular, the United States claims that Regulation 2081/92:  
• does not provide the same treatment to other nationals and products  originating outside 
the EC that it provides to the EC's own nationals and products ( claim 1 ); 
• does not accord immediately and unconditionall y to the nationals and products of each 
WTO Member any advantage, favour, privilege or immunity granted to the nationals and 
products of other WTO Members ( claim 2 ); 
• diminishes the legal protection for trademarks (including to prevent the use of an identical 
or similar sign that is likely to confuse and adequate protection against invalidation) 
(claim 3 ); 
• does not provide legal means for interested parties to prevent the misleading use of a 
geographical indication ( claim 4 ); 
• does not define a geographical indication in a ma nner that is consistent with the definition 
provided in the TRIPS Agreement ( claim 5 ); 
• is not sufficiently transparent ( claim 6 ); 
• and does not provide adequate enforcement procedures ( claim 7 ). 
 (a) The United States request does not indi cate the legal bases of the claims 
41. The United States request does not provide any indication of a legal basis for each of these 
claims. The only reference to substantive WTO provisi ons is contained in the fourth paragraph of the 
Panel request, which states that Regulation 2081/92  appears to be inconsistent with "TRIPS 
Agreement Articles 1.1, 2.1 (incorporating by reference Article 2 of the Paris Convention for the 
Protection of Industrial Property  (Paris Convention (1967)), 3.1, 4, 16.1, 20, 22.1, 22.2, 24.5, 41.1, 
41.2, 41.4, 42, 44.1, 63.1, 63.3, 65.1" as we ll as "Articles I and III:4 of the GATT 1994".  
 42. This long list of WTO provisions, however, is in no way correlated with the individual claims 
raised in the third paragraph of the United States requ est. On the other hand, it is not conceivable that WT/DS174/R/Add.2 
Page B-12  
 
 each of the claims of the United States would be based on all the provisions mentioned in the fourth 
paragraph of the United States request. The result is a total lack of clarity regarding the legal bases of 
the United States’ claims. By not even identifying  the provisions of the WTO agreements which it 
considers to underlie each of its claims, the US falls  short of the minimum requirements for the brief 
summary as established by the Appellate Body in Korea – Dairy .
15 
 
(b) The United States claims are unclear 
43. The absence of a sufficient summary of the lega l bases of the United States claims can also be 
demonstrated for each of the claims set out in the third paragraph of the United States request. 
 
44. As regards the first claim , the United States is alleging that Regulation 2081/92 "does not 
provide the same treatment to othe r nationals and products originati ng outside the EC that it provides 
to the EC's own nationals and products". This claim would appear to be a reference to the principle of 
national treatment, as contained in Article 3 TRIPS and Article III:4 GATT. However, the US claim is 
limited to a paraphrasing of the treaty language of these two provisions. The US claim does not permit 
to understand which provision or aspect of Regul ation 2081/92 is supposed to violate the national 
treatment principle, and in which way such a viola tion is deemed to occur. This does not constitue a 
summary of the legal basis of the claim sufficient to present the problem clearly. 
 45. In its second claim , the United States claims that Re gulation 2081/92 "does not accord 
immediately and unconditionally to the nationals an d products of each WTO Member any advantage, 
favour, privilege or immunity granted to the natio nals and products of other WTO Members". This 
claim seems to be a reference to the principle of most favoured nation treatment, as contained in 
Article 4 TRIPS and Article I:1 GATT. However, as the first claim, this claim is limited to the 
paraphrasing of the language of treaty provisions , without any indication of which provision of 
Regulation 2081/92 is supposed to constitute the vi olation, and how such a violation occurs. More 
specifically, the United States request does not indi cate which are the "other WTO members" who are 
supposed to enjoy more favourable treatment, what constitutes this "more favourable treatment", and 
how it is conferred.  46. As regards the third claim , the United States alleges that Regulation 2081/92 "diminishes the 
legal protection for trademarks". Unfortunately , the United States does not provide any further 
explanation as to why it considers that Regula tion 2081/92 diminishes the "legal protection of 
trademarks". In the view of the EC, this does not constitute a meaningful description of the claim. The 
claim is made no clearer by the cryptic parenthesis "including to prevent the use of an identical or 
similar sign that is likely to confuse and adequate  protection against invalidation", which the United 
States has added to its claim. Moreover, this parenthesis would seems to indicate that there might be 
other aspects diminishing the legal protection for tr ademarks, without however indicating what these 
aspects are.  47. The absence of a brief summary of the third claim is further compounded by the absence of 
any specific references to the provisions of Regulatio n 2081/92. It is certainly correct that Regulation 
2081/92 contains various provisions also concerning trademarks. For instance, Article 14.1 of the 
Regulation concerns the conditions  under which the registration of  a trademark conflicting with a 
geographical indication will be refused or invalid ated. Article 14.2 deals with situations of 
coexistence between trademarks and geographical indications. Article 14.3 provides for situations 
where, in the light of a trademark’s reputation, re nown, and length of time of use, registration of a 
geographical indication shall be refused. Finally, the existence of trademarks is mentioned as a 
possible ground for objection in Article 7 (4) of Regulation 2081/92. 
 
                                                     
 
15 Appellate Body Report, Korea – Dairy , para. 124.  WT/DS174/R/Add.2 
 Page B-13 
 
 
 48. In other words, Regulation 2081/92 deals with conflicts between tradem arks and geographical 
indications in a number of differe nt constellations, and provides for specific solutions for each of 
these. The United States request, by merely referring to the "legal protection of trademarks", does not enable the EC to understand which specific problems the United States wishes to raise in this respect. 
 
49. In its fourth claim , the United States alleges that Regulation 2081/92 "does not provide legal 
means for interested parties to prevent the misleadi ng use of a geographical indication". This claim is 
not comprehensible to the EC. In its Article 13, Regulation 2081/92 cont ains detailed provisions 
regarding the protection of registered geographical  indications. These provisions provide interested 
parties with the legal means to prevent the misleading use of a geographical indication.  In the 
absence  of further explanations, the EC fails to co mprehend what is the claim that the United States is 
intending to establish.  50. In its fifth claim , the United States claims that Regulation 2081/92 does not define a 
geographical indication in a manner that is consis tent with the definition provided in the TRIPS 
Agreement. First of all, the United States does not explain what are the differences in the definition of 
geographical indications between the TRIPS Agreem ent and Regulation 2081/92. Moreover, there is 
no conceivable legal basis for the US claim. It is certainly true that Article 22.1 TRIPS contains a definition of geographical indications. However, this  definition is explicitly made "for the purposes of 
this Agreement", and in particular  for the subsequent provisions setti ng out the substantive obligations 
with respect to the protection of geographic indica tions. In contrast, Article 22.1 does not contain any 
independent obligation to "define" a geographical i ndication in any particular way. It is therefore 
irrelevant under the TRIPS Agreement how the legislation of a WTO Member "defines" a geographical indication, provided that the Member  affords geographical indications the necessary 
protection as required in the provisions of the TRI PS Agreement. In the view of the EC, the United 
States fails therefore to set out a claim in this respect. 
 
51. In its sixth claim , the United States pretends that Regulation 2081/92 "is not sufficiently 
transparent". Once again, this clai m is incomprehensible to the EC . Regulation 2081/92 is a legislative 
measure adopted by the Council of the European Uni on, and published in the Official Journal of the 
European Union. The EC notes that unlike Australia , the United States refers to the transparency of 
the Regulation, rather than that of its  appli cation. The EC does not understand, however, how a 
legislative measure such as Regulation 2081/92 can be said not to be "sufficiently transparent". In any 
case, the US request fails to state in which respect Regulation 2081/92 is supposed not to be "sufficiently transparent".  52. Finally, in its seventh claim , the United States claims that Regulation 2081/92 "does not 
provide adequate enforcement procedures". In the view  of the EC, this claim is devoid of all clarity. 
The United States request neither indicates what, in its view, would be "adequate enforcement 
procedures", nor in which way Regulation 2081/ 92 falls short of providing such procedures. 
Moreover, the United States request does not identify what  is the right to be enforced, an in particular 
whether it is talking about the enforcement of geographical indications or of trademarks. 
 
53. Overall, the EC considers that the United States request fails both to identify the specific 
measure at issue, and to set out  the claims of the United States . The compounded effect of these 
deficiencies is a Panel request of such vagueness  and ambiguity that the EC is not capable to 
understand which is the case that the United States  would like it to answer. For these reasons, the 
Panel must reject the US request as bei ng incompatible with Article 6.2 DSU. 
 
2. The Australian request 
54. The Australian request is marked by deficien cies similar to those of the United States request. 
 WT/DS174/R/Add.2 
Page B-14  
 
 55. The claims of Australia appear to be cont ained in the fifth paragraph of the Australian 
request. In this paragraph, Australia claims th at Regulation 2081/92 (which, according to Australia, 
also includes its "related measures"):  
• diminishes the legal protection for tradem arks under the TRIPS Agreement, contrary 
to Articles 1, 2 (incorporating by reference Articles 6 quinques (B), 10, 10 bis and 10 ter 
of the Paris Convention (1967)), 16, 20, 24. 5, 41 and/or 42 of the TRIPS Agreement 
(claim 1 );   
 
• does not accord immediately and unconditionall y to the nationals and/or products of 
each WTO Member any advantage, favour privilege or immunity granted to the nationals of any other WTO Member, cont rary to Articles 1 and 4 of the TRIPS 
Agreement and/or Article I:1 of GATT 1994 ( claim 2 );   
 
• does not accord to nationals and/or products of each WTO Member treatment no less 
favourable than that it accords to its own nationals and/or like products of national 
origin, contrary to Articles 1, 2 (incorpor ating by reference Article 2 of the Paris 
Convention (1967)) and 3.1 of the TRIPS Agreement and/or Article III:4 of 
GATT 1994 ( claim 3 );   
 
• does not provide the legal means for interest ed parties to prevent misleading use of a 
geographical indication and/or to prevent any use of a geographical indication which 
constitutes an act of unfair competition within the meaning of Article 10bis of the Paris Convention (1967), contrary to Ar ticles 1 and 22.2 of the TRIPS Agreement 
(claim 4 );   
 
• is not applied in a transparent manner, contra ry to Articles 1, and 63.1 and 63.3 of the 
TRIPS Agreement ( claim 5 );   
 
• is a technical regulation within the meani ng of Annex 1 to the TBT Agreement, does 
not accord to products imported from the territory of any WTO Member treatment no 
less favourable than that accorded to like products of national origin and/or to like 
products originating in any other country, and/or has been prepared, adopted and/or 
applied with the effect of creating unnecessary obstacles to trade, being more trade-restrictive than necessary to fulfil a legitimate objective, taking account of the risks non-fulfilment would create, contrary to Ar ticles 2.1 and 2.2 of the TBT Agreement 
(claim 6 ). 
 
(a) The legal bases of the claims indicated in the Australian request are in some cases unclear 
56. The structure of the Australian request differs from that of the United States in that Australia 
does indicate, for each of the claims it makes, the provision of the WTO agreements which it 
considers violated. However, even these listings lack , in some instances, the precision required by the 
Appellate Body in Korea – Dairy .
16 
 57. In its first claim, Australia is referring to "Article 41 and/or 42 of the TRIPS Agreement. 
However, Article 41 TRIPS Agreement is a co mplex provision subdivided into a number of 
paragraphs, which contains a nu mber of different obligations.
17 The same also applies for Article 42 
TRIPS Agreement, which, although set out in one  paragraph, also comprises several sentences 
                                                      
16 Appellate Body Report, Korea – Dairy , para. 124. For the full quotation, see above para. 36. 
17 It is useful to note that the United States reque st refers only to Articles 41.2 and 41.4 TRIPS.  WT/DS174/R/Add.2 
 Page B-15 
 
 
 establishing distinct obligations for WTO Members.  Finally, the EC does not understand the "and/or" 
which seems to indicate that Articles 41 and 42 TRIPS are somehow alternative obligations. 
 58. Also in its first claim, Australia refers, in  conjunction with Article 2 TRIPS Agreement, to 
Articles 10, 10 bis and 10 ter of the Paris Convention. Once again, these articles of the Paris 
Convention are complex provisions subdivided in to various paragraphs , and imposing numerous 
distinct obligations.  59. Accordingly, the EC considers that the re ferences to Articles 41 and 42 TRIPS Agreement, 
and to Articles 10, 10 bis and 10 ter of the Paris Convention do not meet the minimum requirements of 
specificity under Article 6.2 DSU. 
 (b) The Australian claims are unclear 
60. However, even where the Australian request  lists correctly the provisions of the WTO 
agreements, this indication of treaty provisions is  not sufficient for the purposes of Article 6.2 DSU. 
This is due to the fact that the narrative descripti on of the claims, as in the case of the United States 
request, is limited to the paraphrasing of the text of tr eaty provisions, or is so excessively vague that it 
does not permit to understand the s ubstance of Australia’s claims. 
 61. Since most of Australia’s claims are similar to those of the United States, reference can be 
made to what has been said about the United States request. Australia’s claim 1 is almost identical to 
the United States claim 3,
18 and similarly fails to meet the requirements of Article 6.2 DSU.19 
Australia’s claim 2 is similar to US claim 2, and Australia’s claim 3 is similar to US claim 1. Like the 
US claims, Australia’s claims 2 a nd 3 are limited to the restatement of language already contained in 
treaty provisions, and therefore encounter the same objections.20 Australia’s claim 4  corresponds to 
the fourth claim of the United States, so that refere nce can be made to what has been said in this 
respect.21 Finally, claim 5 corresponds to United States claim 6, w ith the sole difference that Australia 
refers to the transparency of the "application of Regulation 2081/92", rather than that of the 
Regulation itself. However, since Australia fails to  explain in which way Regulation 2081/92 is not 
applied in a transparent way, its claim fails to m eet the requirements of Artic le 6.2 DSU for the same 
reasons as the United States claim.22 
 
62. The only claim of Australia which finds no equivalent in the United States request is claim 6 , 
by which Australia raises certain  claims under the TBT Agreement,  namely that Regulation 2081/92 
"is a technical regulation within the meaning of Annex 1 to the TBT Agreement, does not accord to 
products imported from the territory of any WTO Member treatment no less  favourable than that 
accorded to like products of national origin and/or  to like products originating in any other country, 
and/or has been prepared, adopted and/or applied with the effect of creating unnecessary obstacles to 
trade, being more trade-restrictive than necessary to  fulfil a legitimate objective, taking account of the 
risks non-fulfilment would create, contrary to Articles 2.1 and 2.2 of the TBT Agreement".  63. As to the first element of this claim, namely whether Regulation 2081/92 is a "technical regulation" within the meaning of Annex 1 to the TBT Agreement, the EC considers that this cannot 
constitute an admissible claim, since Point 1 of Annex 1 to the TBT Agreement, which defines the 
                                                     
 
18 The only difference is that the Australian request does not contain the cryptic parenthesis included in 
the United States request. 
19 Supra para. 46 to 48. 
20 Supra para. 44 to 45. 
21 Supra para. 49. 
22 Supra para. 51. WT/DS174/R/Add.2 
Page B-16  
 
 term "technical regulation" for the purposes of th e TBT Agreement, does not impose any obligations 
which could have been violated by the EC.
23 
 64. As regards the claims that Regulation 2081/92  does not accord to products imported from the 
territory of any WTO Member treatment no less fa vourable than that accorded to like products of 
national origin and/or to like pr oducts originating in any other country, and/or has been prepared, 
adopted and/or applied with the effect of creati ng unnecessary obstacles to tr ade, these claims merely 
seem to restate language which is contained in Ar ticle 2.1 and 2.2 of the TBT Agreement, without 
however providing any indication of how Regulati on 2081/92, and which provision thereof, violates 
these obligations. For the same reasons as Australia’s claims 2 and 3, claim 6 therefore fails to meet 
the requirements of Article 6.2 DSU. 
 65. In conclusion, both the United States and the US request fail to contain a brief summary of the legal basis of the claims, as required by Article  6.2 DSU. Both request do not "present the problem 
clearly". For the reasons set out above, the EC c onsiders that both the Australian and the US Panel 
requests fail to meet the requirements of Article 6.2 DSU. 
 
V. THE DEFICIENCIES OF THE PANEL REQUESTS RESULT IN SERIOUS 
PREJUDICE FOR THE EUROPEAN COMMUNITY AS A DEFENDANT 
66. As has been stated above, the requirements of  Article 6.2 DSU also serve to protect the due 
process rights of the defending party in dis pute settlement proceedings under the DSU.
24 As a 
consequence, the Appellate Body has, when c onsidering the requirements of Article 6.2 DSU, 
attached importance to the question of whether the defending party has suffered prejudice as a result 
of the deficiencies of a panel request.25 
 67. In the present case, the EC considers it clear that  it is prejudiced by the lack of clarity of the 
United States and Australian request. As a defending party, the EC has a right to know what the case 
is which it will have to defend. This informa tion must be contained in the Panel request.  
 68. In the present case, the ambiguity of the Panel requ est is such that the EC is, to this date, not 
sure of the case which the United States and Australia are bringing before the Panel. As a consequence, the EC has been seriously hamper ed in its efforts to prepare its defence. 
 
69. This situation is not acceptable from the point of view of the due process rights of the EC. Dispute settlement proceedings under the DSU are subject  to very strict deadlines. As a consequence, 
the EC cannot be expected to wait for the first written submission of the complainants to start 
preparing its defence. Rather, the time betwee n the submission of the panel request and the 
constitution of the Panel is used by both complaini ng and defending parties for the preparation of their 
case.  70. The strict respect of Article 6.2 DSU is also  necessary to ensure a level playing field for the 
complaining and defending parties. Since the comp lainants have the initiative in dispute settlement, 
they can take all the time necessary to prepare th eir case before the introduction of the panel request. 
In contrast, the defendant can begin preparing its  case only once he has received a notice of the case 
in accordance with Article 6.2 DSU.  
                                                     
 
23 Cf. also the discussion of Unite d States claim 5 (supra para. 50). 
24 Supra note 4. 
25 Appellate Body Report, Korea – Dairy , para. 131; Appellate Body Report, Thailand – H Beams , 
para. 95. The EC does consider it necessary, in the presen t case, to take a position as to whether the requirement 
of prejudice in Article 6.2 DSU constitutes an additiona l requirement to those set out in Article 6.2 DSU.  WT/DS174/R/Add.2 
 Page B-17 
 
 
 71. The EC notes that the United States has, as  a defending party, frequently criticised Panel 
requests for not respecting the requirements of Article  6.2 DSU, and has requested preliminary rulings 
on this question.26 In the present context, the EC consider s it useful to quote from the United States’ 
submissions before the Panel in US – Lamb :27 
 
The insufficiency of the Panel requests has seriously prejudiced the United States in 
the preparation of its defense.  It prev ented the United States from knowing the true 
nature of the claims being made against the U.S. measure and placed the United States in the position of merely guessing wh ich of the many obligations in these 
several articles might be at issue in this re view.   This severely limited the ability of 
the United States to begin the task of prep aring its defense.  The dispute resolution 
process is intended to be a relatively sp eedy process.  Central to such a speedy 
process is the requirement that claims be clearly stated at the required time.  The failure of a complaining party to do so prejudices the responding party and undercuts 
the fairness of the entire process.  It effec tively stacks the deck against the responding 
party. 
72. The EC does not consider that different st andards should be applied in the present case. The 
EC would also like to recall that Article 3.10 DSU requires Members to engage in dispute settlement 
procedures in good faith. As the Appellate Body has underlined in US – FSC , this obligations applies 
also to the complainants:
28 
 
This pervasive principle requires both complaining and responding Members to 
comply with the requirements of the DSU (and related requirements in other covered 
agreements) in good faith. By good faith compliance, complaining Members accord to the responding Members the full measure of protection and opportunity to defend, contemplated by the letter and spirit of the procedural rules. 
73. The EC does not wish to speculate about what are the reasons for the deficient drafting of the 
Panel requests. In particular, the EC does not know  whether this drafting reflects a conscious choice 
on the side of the complainants to leave the EC in  the dark about their prospective case, or whether 
the complainants simply were unsure of the case that  they were intending to bring. Whatever the 
explanation may be, the Panel requests in their curr ent form would provide the complainants with a 
maximum flexibility in terms of their subsequent litig ation strategy, and oblige the EC to defend itself 
against a moving target. This is not in accordance  with the requirement of due process underlying 
Article 6.2 DSU.  74. By keeping their panel requests excessivel y vague, the United States and Australia have 
prevented the EC from preparing its defence in a timely manner. They have thereby caused serious 
prejudice to the EC.  
 
VI. THE DEFICIENCIES OF THE PANEL REQUESTS HAVE BEEN RAISED BY THE 
EC IN A TIMELY MANNER, AND MUST BE ADDRESSED WITHOUT DELAY 
75. In considering the requirements of Article 6. 2 DSU, the Appellate Body has held that the 
respect of the conditions of this provision is of a fundamental nature, and may be examined at any 
stage in the proceedings.
29 
 
                                                      
26 Panel Report, US – Lamb , para. 5.5; Panel Report, US – Carbon Steel , para. 4.1-4.2. 
27 Panel Report, US – Lamb , para. 5.5 
28 Appellate Body Report, US – FSC , para. 166. 
29 Appellate Body Report, US – Carbon Steel , para. 123. WT/DS174/R/Add.2 
Page B-18  
 
 76. At the same time, the Appellate Body has att ached importance to the fact that the parties 
should bring procedural deficiencies to the atten tion of the Panel at the earliest possible opportunity.
30 
This requirement was justified by the Appellate Body in US – FSC on the basis of the principle of 
good faith, which pervades dispute se ttlement proceedings under the DSU:31 
 
Article 3.10 of the DSU commits Members of the WTO, if a dispute arises, to engage 
in dispute settlement procedures "in good faith in an effort to resolve the dispute".  
This is another specific manifestation of the principle of good faith which, we have 
pointed out, is at once a general principle of law and a principle of general international law.  This pervasive princi ple requires both complaining and responding 
Members to comply with the requirements of the DSU (and related requirements in 
other covered agreements) in good faith. By  good faith compliance, complaining 
Members accord to the responding Members the full measure of protection and opportunity to defend, contemplated by the letter and spirit of the procedural rules.  The same principle of good faith requires that responding Members seasonably and 
promptly bring claimed procedural deficiencies to the attention of the complaining 
Member, and to the DSB or the Panel, so th at corrections, if needed, can be made to 
resolve disputes.  The procedural rules of WTO dispute settlement are designed to 
promote, not the development of litigation t echniques, but simply the fair, prompt and 
effective resolution of trade disputes. 
77. The present request for a preliminary ruli ng is in full accordance with these requirements 
established by the Appellate Body. The EC has raised  the objection regarding the compatibility of the 
Panel requests with Article 6.2 DSU at the first possible occasion, namely at the meeting of the Dispute Settlement Body (DSB) on 29 August 2003, at which the requests were discussed for the first 
time.
32 At this meeting, the EC explicitly called upon the United States and Australia to submit new 
panel requests compatible with Article 6.2 DSU. Since the complainants failed to do so, the EC 
repeated its concerns at the second meeting of the DSB on 2 October 2003, and reserved its rights to 
raise the issue during the Panel proceedings.33 
 78. In the view of the EC, the deficiencies of the Panel requests are such that they will affect the 
entire subsequent proceedings. In particular, if th e Panel requests are not amended, the scope of the 
present dispute will remain entirely unclear. This will have as an inevitable consequence that the 
submissions of the parties will have to deal not only  with issues of substance, but also with the scope 
of the claims of the complainants. Moreover, it wo uld be regrettable for th e Parties to engage in 
pleadings on the substance of the dispute, only for the Panel requests to be found insufficient in the 
Panel report or by the Appellate Body. For these re asons, and in order to saf eguard the proper conduct 
of the present dispute settlement proceedings, the EC considers it appropriate for the Panel to issue a 
preliminary ruling regarding Article 6.2 DSU. 
 79. This would also be in line with the ruling of the Appellate Body has EC – Bananas, in which 
the Appellate Body held that questions regarding the respect of Article 6.2 DSU should be decided 
early in panel proceedings, without causing prejudice or unfairness to any party or third party.
34 
 
                                                      
30 Appellate Body Report, Thailand – H Beams , para. 95; Appellate Body Report, US – Carbon Steel , 
para. 123. 
31 Appellate Body Report, US – FSC , para. 166. 
32 Minutes of the Meeting of the Dispute Settlement Body of 29 August 2003, WT/DSB/M/155, 
para. 75 (Exhibit EC-2). 
33 Minutes of the Meeting of the Dispute Settlement Body of 2 October 2003, WT/DSB/M/156, 
para. 32 (Exhibit EC-3). 
34 Appellate Body Report, EC – Bananas III , para. 144.  WT/DS174/R/Add.2 
 Page B-19 
 
 
 80. The EC would like to clarify that it remain s committed to a speedy resolution of the present 
dispute. For this reason, the EC would not consider  it inappropriate for the Panel to suggest to the 
complaining parties to introduce a new Panel request  in full compliance with Article 6.2 DSU. The 
EC would like to note that such a course of ac tion has recently been taken by a Panel in another 
dispute.35 
 
VII. CONCLUSION 
81. For the reasons set out above, the EC respectfu lly requests that the Panel find that the panel 
requests do not meet the requirements of Article 6.2 DSU.  
82. Given the importance of the jurisdictional issues raised in the present request, the EC 
considers it appropriate that the Panel issue a prelim inary ruling on this matter before the first written 
submissions of the Parties are due.  
                                                     
 
35 Cf. Preliminary Ruling by the Panel, Canada – Wheat , para. 65. In this case, the United States indeed 
introduced a new Panel request (WT/DS276/9). The dispute then continued to be heard before the Panel 
originally established after the first Panel request. WT/DS174/R/Add.2 
Page B-20  
 
 ANNEX B-2 
 
FIRST WRITTEN SUBMISSION OF THE EUROPEAN COMMUNITIES 
 
(25 May 2004) 
 
 
TABLE OF CONTENTS 
 
GLOSSARY ....................................................................................................................... .................................26 
I. INTRODUCTION ................................................................................................................... ..................28  
II. TERMS OF REFERENCE ............................................................................................................. ..........28  
A. THE MEASURE AT ISSUE .......................................................................................................................29  
1. Versions of Regulation 2081/92 no lo nger in force at the time the Panel was 
establis hed.................................................................................................................... ............29  
2. Measures not yet adopted at the time the Panel was established ..........................................30  
B. CLAIMS ............................................................................................................................... .................31  
1. Australia's claim under Article 4 of the Paris Convention ....................................................31  
2. Australia's claim under Articles 43 to 49 of the TRIPS .........................................................32  
3. The claims regarding Article 2. 2 of the Paris Convention.....................................................32  
III. FACTS .......................................................................................................................... ..............................33  
A. THE DEFINITION OF GEOGRAPHIC INDICATIONS ....................................................................................34  
B. PRODUCT SPECIFICATIONS ...................................................................................................................34  
C. INSPECTION STRUCTURES .....................................................................................................................35  
D. THE REGISTRATION OF GEOGRAPHICAL INDICATIONS RELATING TO AN AREA LOCATED IN 
THE EC ............................................................................................................................ ....................36  
E. THE REGISTRATION OF GEOGRAPHICAL INDICATIONS RELATING TO AN AREA LOCATED OUTSIDE 
THE EC ............................................................................................................................. ...................37  
F. OBJECTIONS FROM PERSONS RESIDENT OR ESTABLISHED IN THE EC....................................................38  
G. OBJECTIONS FROM PERSONS RESIDENT OR ESTABLISHED OUTSIDE THE EC..........................................39  
H. DECISION -MAKING PROCEDURES UNDER THE REGULATION .................................................................40  
I. THE PROTECTION OF GEOGRAPHICAL INDICATIONS ..............................................................................41  
J. INDICATION OF THE COUNTRY OF ORIGIN FOR HOMONYMOUS GEOGRAPHICAL INDICATIONS ...............41  
K. GEOGRAPHICAL INDICATIONS AND TRADEMARKS ................................................................................42  
L. SIMPLIFIED REGISTRATION OF GEOGRAPHICAL INDICATIONS PRIOR TO THE ENTRY INTO FORCE 
OF REGULATION  692/2003...................................................................................................................43  
IV. REGULATION 2081/92 IS COMPAT IBLE WITH NATIONAL TREATMENT 
OBLIGATIONS, AND DOES NOT IMPOSE A REQUIREMENT OF DOMICILE OR 
ESTABLISH MENT.................................................................................................................. .................44  
A. NATIONAL TREATMENT UNDER THE TRIPS  AGREEMENT (ARTICLE  3.1  TRIPS  AND ARTICLE  2.1  
TRIPS  IN CONJUNCTION WITH ARTICLE  2.1  PARIS CONVENTION ).......................................................44  
1. General re marks................................................................................................................ ........45  
2. Claims 1: Non-EC nation als are accorded less favor able treatment than EC 
nationals with respect to the registration of geographical indications through the 
application of a condition of  reciprocity and equivalence ...................................................47  
(a) The EC does not apply a condi tion of reciprocity and equivalence for the registration of 
geographical indications fro m other WTO members.........................................................................47   WT/DS174/R/Add.2 
 Page B-21 
 
 
 (b) The conditions for the registration of indivi dual geographical indications do not constitute 
less favourable  treatment...................................................................................................... .............48  
(c) The conditions for the registration of geographi cal indications do not depend on nationality............48  
3. Claim 2: Regulation 2081/92 violates the national treatment obligations under the 
TRIPS and the Paris Convention by re quiring that applications must be 
transmitted by the country in which the geographical area is located ...............................49  
4. Claim 3: Non-EC nationals are accorded less favorable treatment than EC nationals 
with respect to the requirement to indicate  the country of origin for homonymous 
geographical i ndications ....................................................................................................... ..50 
(a) Article 12(2) of Regulation 2081/92 does not ap ply to all geographica l indications, but only 
to homon yms .................................................................................................................... .................50  
(b) The requirement to indicate the country of origin for homonymous ge ographical indications 
from the EC and third countries does not  constitute less favour able treatment .................................50  
(c) Article 12(2) of Regulation 2081/92 does not discriminate be tween nati onals ..................................51  
5. Claim 4: Regulation 2081/92 accords less favourable treatment to non-EC nationals 
by subjecting the right to ob ject to the registration of  geographical indications to 
conditions of reciprocit y and equivalence .............................................................................51  
6. Claim 5: Regulation 2081/92 accords less favourable treatment to non-EC nationals 
by requiring their own country to transmit the objection ...................................................52  
7. Claim 6: Regulation 2081/92 accords less favourable treatment to non-EC nationals 
by requiring non-EC national to have a "legitimate interest" to object to the 
registration of geographical indications ................................................................................52  
8. Claim 7: Regulation 2081/92 accords less favourable treatment because a non-EC 
rightholder has no "representative" in  the regulatory committee to "speak for 
him"........................................................................................................................... ...............53  
9. Claim 8: A right of objection was available to  persons resident or established in an 
EC Member State that was not availabl e to other WTO Member nationals in 
respect of the registration of more than  120 geographical indications under the 
normal registration process.................................................................................................... 53 
(a) Australia's claim relates to  a measure which was no longer in force at the time of 
establishment of the Panel, and which is theref ore not within the terms of reference of the 
Panel.......................................................................................................................... ........................53  
(b) The individual registrations are not in vi olation of national tr eatment oblig ations.............................54  
(c) Australia is seeking to obtain a retroactive reme dy it could not have obtained had it attacked 
the measure while it wa s still in force........................................................................................ ........54  
10. Claim 9: A right of objection was available to  persons resident or established in an 
EC Member State that was not availabl e to other WTO Member nationals in 
respect of the registration of more than  480 EC-defined GIs under the simplified 
registration process ........................................................................................................... ......56  
B. PROHIBITED REQUIREMENT OF DOMICILE OR ESTABLISHMENT (ARTICLE  2.1  TRIPS  IN 
CONJUNCTION WITH ARTICLE  2.2  PARIS CONVENTION ).......................................................................56  
1. Claim 10: Regulation 2081/92 requires non- EC nationals to become established in 
the EC as a condition for regist ering geographical indications...........................................56  
(a) Geographical indications relating to an area located in a WTO country can be registered 
under Regulati on 2081/ 92 ....................................................................................................... ..........57  
(b) The right to register a geographical indication does not depend on domicile or establishment..........57  
(c) Article 2.2 Paris Convention does not exclude  measures which en sure that a product 
originates in the geographical area to which a protected geographical indication is related..............58  
2. Claim 11: Regulation 2081/92 requires non- EC nationals to become established in 
the EC as a condition for objecting........................................................................................58  
C. NATIONAL TREATMENT UNDER ARTICLE  III:4  GATT.........................................................................58  
1. The regulation 2081/92 is not incomp atible with Arti cle III:4 GATT ..................................59  
(a) General remarks ................................................................................................................ .................59  
(i) Like pr oducts.................................................................................................................. ...........59  
(ii) Less favourable treatment ...................................................................................................... ...60 
(b) Claim 12: Regulation 2081/92 accords less favourable treatment as regards the conditions for 
registration of foreign geographical indications ............................................................................... .61 
(c) Claim 13: Regulation 2081/92 accords less favourab le treatment as regards the requirement 
that the application must be transmitted by  the government of the third country ..............................61  WT/DS174/R/Add.2 
Page B-22  
 
 (d) Claim 14: Regulation 2081/92 accords less favourab le treatment as regards the requirement 
to indicate the c ountry of origin.............................................................................................. ...........62  
(i) Article 12(2) of Regulation 2081/92 does not apply to all geographical indications, but 
only to homony ms ............................................................................................................... ......62  
(ii) The requirement to indicate the country  of origin for homonymous geographical 
indications from the EC and third countri es does not constitute less favourable 
treatment...................................................................................................................... .............62  
(iii) Article IX:1 of the GATT is a lex specialis  to Article III:4 GATT; national treatment 
obligations therefore do not apply to require ments to mark the country of origin ...................62  
(e) Claim 15: Regulation 2081/92 accords less favourable treatment due to an overall bias in the 
decision-making  process........................................................................................................ ............63  
2. The measure would be justified under Article XX (d) GATT...............................................64  
V. REGULATION 2081/92 IS COMPATIBLE WITH THE OBLIGATION TO PROVIDE 
MOST-FAVOURED-NATION TREATMENT......................................................................................64  
A. ARTICLE  4 TRIPS.......................................................................................................................... ......64  
1. Claim 16: As among non-EC WTO Members, nationals from WTO Members that 
satisfy the EC's conditio ns of reciprocity and equivalency are accorded more 
favourable treatment than nationals from those WTO Members that do not...................65  
(a) The EC does not apply a condi tion of reciprocity and equivalence for the registration of 
geographical indications fro m other WTO members.........................................................................65  
(b) The conditions for the registration of individua l geographical indications  from third countries 
are not disc riminatory......................................................................................................... ...............66  
(c) Article 12 of Regulation 2081/92 does not gr ant any advantage, favour, privilege or 
immunity to any other country .................................................................................................. ........66  
(d) The conditions for the registration of geographi cal indications do not depend on nationality............68  
2. Claim 17: Under Regulation 2081/92, an EC Member State grants more favourable 
treatment to nationals from other EC Memb er States than it accords to nationals 
from non-EC WTO Members ................................................................................................68  
B. CLAIM 18: BY SUBJECTING THE REGISTRATION OF THIRD -COUNTRY GEOGRAPHICAL 
INDICATIONS TO CONDITIONS OF RECIPROCITY AND EQUIVALENCE , THE EC MEASURE IS 
INCONSISTENT WITH THE MOST -FAVOURED -NATION OBLIGATION UNDER THE ARTICLE  I:1 
GATT........................................................................................................................... .......................69  
1. Article I:1 GATT is  not violated ..............................................................................................6 9 
2. The EC measure would be justifie d under Article XX (d) GATT ........................................70  
VI. REGULATION 2081/92 DOES NOT DIMI NISH THE LEGAL PROTECTION OF 
TRADEMARKS..................................................................................................................... ....................70  
A. ARTICLE  16.1  OF THE TRIPS  AGREEMENT ..........................................................................................70  
1. Claim 19: Article 14(2) of Regulation 2081/92 is inconsistent with Article 16.1 of the 
TRIPS Agreement in that it a llows the co-existence of geographical indications and 
earlier registered trademarks.................................................................................................7 0 
(a) Regulation 2081/92 does not allow the regi stration of confus ing tradem arks ....................................71  
(i) Registrability of geographica l names as tr ademark s ................................................................72  
(ii) Article 14(3) of Re gulation 2081 /92..........................................................................................74  
(iii) Provisional conclu sion......................................................................................................... .....75 
(b) Article 24.5 envisages  the co-exist ence of GIs and ear lier tradem arks..............................................75  
(c) The EC is required to maintain the co-exist ence of geographical indications and earlier 
trademarks by Article 24.3 ..................................................................................................... ...........80  
(d) In any event, the co-existence of geographical indications and earlier trademarks would be 
justified under Article 17 of  the TRIPS Ag reement...........................................................................81  
2. Claim 20: Regulation 2081/92 does not provide for a presumption of a likelihood of 
confusion in the case of use of an identical sign for identical goods....................................82  
3. Claim 21:  Article 7(4) of Regulation 2081/92 is inconsistent with Article 16.1 of the 
TRIPS Agreement because it limits the grounds of objection.............................................82  
(a) Article 16.1 of the TRIPS Agreement doe s not confer a righ t of objection........................................83  
(b) Australia has misread Article 7(4) of Regula tion 2081/ 92 .................................................................83  
4. Claim 22: Regulation 2081/92 does not ensure that objections from trademark 
owners will be considered  by the Co mmittee........................................................................84   WT/DS174/R/Add.2 
 Page B-23 
 
 
 B. CLAIM 23: BY REQUIRING THE CO -EXISTENCE OF A REGISTERED GEOGRAPHICAL INDICATION 
AND AN EARLIER TRADEMARK , ARTICLE  14(2)  ENCUMBERS UNJUSTIFIABLY THE USE OF THE 
TRADEMARK , CONTRARY TO ARTICLE  20 OF THE TRIPS  AGREEMENT ................................................85  
C. CLAIM 24: ARTICLE  14(1)  OF REGULATION 2081/92  IS INCONSISTENT WITH ARTICLE  24.5  OF 
THE TRIPS  AGREEMENT BECAUSE IT DOES NOT AFFORD THE RIGHT OF PRIORITY PROVIDED IN 
ARTICLE  4 OF THE PARIS CONVENTION ...............................................................................................86  
D. ARTICLES 41.1,  41.2,  41.3,  41.4,  42, 43, 44.1,  45, 46, 48 AND 49 OF THE TRIPS  AGREEMENT ............87  
1. General Cons iderations ......................................................................................................... ...87 
2. Claim 25: Regulation 2081/92 is inconsistent with Article 41.1 of the TRIPS 
Agreement...................................................................................................................... ..........88  
3. Claim 26: Regulation 2081/92 is inconsistent with Article 41.2 of the TRIPS 
Agreement...................................................................................................................... ..........89  
(a) The procedures provided in Regulation 2081/92  are neither inequ itable nor unfair...........................89  
(b) The procedures provided in Regulation 2081/92 ar e not unnecessarily complicated and do not 
entail unwarrant ed delays ...................................................................................................... ............90  
4. Claim 27: Regulation 2081/92 is inconsistent with Article 41.3 of the TRIPS 
Agreement...................................................................................................................... ..........91  
5. Claim 28: Regulation 2081/92 is inconsistent with Article 41.4 of the TRIPS 
Agreement...................................................................................................................... ..........91  
6. Claim 29: Regulation 2081/92 is inconsistent with Article 42 of the TRIPS 
Agreement...................................................................................................................... ..........92  
E. CLAIM 30: REGULATION 2081/92  IS INCONSISTENT WITH ARTICLE  10BIS (1) AND 10TER (1) OF 
THE PARIS CONVENTION ......................................................................................................................92  
F. CONSEQUENTIAL CLAIMS ....................................................................................................................93  
1. Claim 31: Regulation 2081/92 is incons istent with Article 2.1 of the TRIPS 
Agreement...................................................................................................................... ..........93  
2. Claim 32: Regulation 2081/92 is incons istent with Article 1.1 of the TRIPS 
Agreement...................................................................................................................... ..........93  
3. Claim 33: The transitional national protection provided by the Member States is 
inconsistent with Articles 2.1, 16.1, 41.1, 41.2, 41.3 and/or 42 of the TRIPS 
Agreement...................................................................................................................... ..........93  
VII. THE EC MEASURE IS CONSISTENT WI TH THE OBLIGATION TO PROVIDE 
PROTECTION TO GEOGRAPHICAL INDICA TIONS UNDER ARTICLE 22.2 OF THE 
TRIPS AGREEMENT ................................................................................................................ ..............94  
1. Claim 34: Regulation 2081/92 is inconsistent with Article 22.2 of the TRIPS 
Agreement...................................................................................................................... ..........94  
2. Claim 35: Regulation 2081/92 is incons istent with Article 1.1 of the TRIPS 
Agreement because it is incons istent with Article 22.2 ........................................................95  
3. Claim 36: Regulation 2081/92 is incons istent with Article 22.2 TRIPS................................95  
(a) Regulation 2081/92 provides to interested pa rties of other WTO Members the means to 
prevent the acts menti oned in Artic le 22.2 ..................................................................................... ...95 
(i) Reciprocity and equi valence co nditions....................................................................................95  
(ii) The requirement that the application must  be transmitted by the Government .........................96  
(iii) The right of  objection......................................................................................................... .......96  
(b) The EC and its Member States provides to in terested parties of ot her WTO Members other 
means to prevent the acts me ntioned in Ar ticle 22.2 .........................................................................97  
VIII. REGULATION 2081/92 IS CONSISTENT  WITH OBLIGATIONS UNDER THE TBT 
AGREEMENT ...................................................................................................................... .....................97  
A. REGULATION 2081/92  IS NOT A TECHNICAL REGULATION ....................................................................98  
1. General........................................................................................................................ ...............98  
2. Article 12(2) of Regulation 2081/9 2 is not a techni cal regulation..........................................99  
(a) Article 12(2) does not appl y to identifia ble prod ucts.......................................................................... 99 
(b) Article 12(2) does not lay down product char acteristics.....................................................................99  
(c) Article 12(2) of Regulation 2081/92 is not mandato ry .....................................................................100  
3. Articles 4 and 10 of Regulation 2081 /92 are not a techni cal regulat ion..............................100  
(a) Articles 4 and 10 do not lay down product char acteristics ...............................................................100  WT/DS174/R/Add.2 
Page B-24  
 
 (b) Articles 4 and 10 are not mandatory............................................................................................ .....101  
B. CLAIM 37: ARTICLE  12(2)  OF REGULATION 2081/92  IS INCOMPATIBLE WITH ARTICLE  2.1  OF 
THE TBT  AGREEMENT .......................................................................................................................101  
1. General........................................................................................................................ .............102  
2. Article 12(2) of Regulation 2081/92 does not apply to all geographical indications, 
but only to  homonyms........................................................................................................... 102 
3. The requirement to indicate the country of origin for homonymous geographical 
indications from the EC and third countrie s does not constitute less favourable 
treatment...................................................................................................................... ..........102  
4. National treatment obligations do not appl y to requirements to mark the country of 
origin ......................................................................................................................... .............103  
C. CLAIM 38: ARTICLES 4, 10, AND 12 (1) OF REGULATION 2081/92  ARE INCOMPATIBLE WITH 
ARTICLE  2.2  OF THE TBT  AGREEMENT .............................................................................................103  
1. The existence of inspection structures is only required with respect to the specific 
product for which protec tion is sought................................................................................104  
2. The Regulation does not determine the specifi c design of the inspection structures.........104  
3. The existence of inspection structures is necessary to achieve the legitimate 
objectives of Regulation 2081/92 ..........................................................................................105  
IX. CLAIM 39, 40: THE EC MEASURE IS COMP ATIBLE WITH ARTICLE 65.1 TRIPS AND 
ARTICLE XVI:4  WTO.............................................................................................................. .............106  
X. CONCLUSION ..................................................................................................................... ...................106  
  WT/DS174/R/Add.2 
 Page B-25 
 
 
 Table of WTO and GATT cases referred to in this submission 
 
Short Title Full Case Title and Citation of Case 
Argentina – Textiles 
and Apparel  Panel Report, Argentina – Measures Affecting Impor ts of Footwear, Textiles, Apparel 
and Other Items , WT/DS56/R, adopted 22 April 1998, as modified by the Appellate 
Body Report, WT/DS56/AB/R, DSR 1998:III, 1033 
Australia – Automotive Leather
  Panel Report, Australia – Subsidies Provided to Producers and Exporters of Automotive 
Leather , WT/DS126/R, adopted 16 June 1999, DSR 1999:III, 951 
Belgian Family 
Allowances GATT 1947 Panel Report, Belgian Family Allowances , adopted on 7 November 1952, 
1S/59 
Canada – Autos  Panel Report, Canada – Certain Measures Affecting the Automotive Industry , 
WT/DS139/R, WT/DS142/R, adopted 19 June 2000, as modified by the Appellate Body Report, WT/DS139/AB/R, WT/DS142/AB/R, DSR 2000:VII, 3043 
EEC – Beef from 
Canada GATT 1947 Panel Report, European Economic Community – Imports of Beef from 
Canada , adopted on 10 March 1981, 28S/92 
EC – Asbestos  Appellate Body Report, European Communities – Measures Affecting Asbestos and 
Asbestos-Containing Products , WT/DS135/AB/R, adopted 5 April 2001 
EC – Sardines  Appellate Body Report, European Communities – Trade Description of Sardines , 
WT/DS231/AB/R, adopted 23 October 2002 
India – Autos  Panel Report, India – Measures Affecting the Automotive Sector , WT/DS146/R, 
WT/DS175/R and Corr.1, adopted 5 April 2002 
India – Patents (US)
  Appellate Body Report, India – Patent Protection for Pharmaceutical and Agricultural 
Chemical Products , WT/DS50/AB/R, adopted 16 January 1998, DSR 1998:I, 9 
Indonesia – Autos  Panel Report, Indonesia – Certain Measures Affecting the Automobile Industry , 
WT/DS54/R, WT/DS55/R, WT/DS59/R, WT/DS64/R and Corr.1, 2, 3, and 4, adopted 
23 July 1998, DSR 1998:VI, 2201 
Japan – Film  Panel Report, Japan – Measures Affecting Consum er Photographic Film and Paper , 
WT/DS44/R, adopted 22 April 1998, DSR 1998:IV, 1179 
Korea – Dairy  Appellate Body Report, Korea – Definitive Safeguard Measure on Imports of Certain 
Dairy Products , WT/DS98/AB/R, adopted 12 January 2000, DSR 2000:I, 3 
Korea – Various 
Measures on Beef  Appellate Body Report, Korea – Measures Affecting Imports of Fresh, Chilled and 
Frozen Beef , WT/DS161/AB/R, WT/DS169/AB/R, adopted 10 January 2001 
Norway –
Trondheim Bridge Panel report under the 1979 Agreement on Government Procurement, Norway –
Procurement of Toll Collection Equipment for the City of Trondheim , GPR/DS.2/R, 
adopted 13 May 1992 
US – Tuna GATT 1947 Panel Report, United States – Restrictions on Imports of Tuna , DS21/R, 3 
September 1991, 39S/155, not adopted 
US – Certain EC 
Products  Appellate Body Report, United States – Import Measures on Certain Products from the 
European Communities , WT/DS165/AB/R, adopted 10 January 2001 
US – Gasoline  Panel Report, United States – Standards for Reformulated and Conventional Gasoline , 
WT/DS2/R, adopted 20 May 1996, as modified by the Appellate Body Report, WT/DS2/AB/R, DSR 1996:I, 29 
US – Section 211 
Appropriations Act  Appellate Body Report, United States – Section 211 Omnibus Appropriations Act of 
1998 , WT/DS176/AB/R, adopted 1 February 2002 
US – Wool Shirts 
and Blouses  Appellate Body Report, United States – Measure Affecting Imports of Woven Wool Shirts 
and Blouses from India , WT/DS33/AB/R and Corr.1, adopted 23 May 1997, 
DSR 1997:I, 323 
 WT/DS174/R/Add.2 
Page B-26  
 
 GLOSSARY
 
 
 Commission, EC Commission  Commission of the European Communities 
 
Committee  Committee of representatives of the 
Member States referred to in Article 15 of Council Regulation 2081/92 
 Community Trademark Regulation Council Regulation (EC) No 40/94, of 
20 December 1993, on the Community 
Trademark, as amended on the date of establishment of the Panel 
 Council, EC Council  Council of the European Union 
 
Court of Justice, European Court of Justice  Court of Justice of the European 
Communities 
 DSU  Understanding on Rules and Procedures 
Governing the Settlement of Disputes 
 
EC European Communities 
 GATT  General Agreement on Tariffs and Trade 
1994 
 
FWS  First Written Submission 
 GI Geographical indication 
 Member States, EC Member States  Member States of the European Union 
 
Official Journal  Official Journal of the European Union 
 Paris Convention  Stockholm Act of the Paris Convention for 
the protection of Industrial property, of 
14 July 1967 
 Regulation 2081/92, Regulation  Council Regulation (EEC) No 2081/92 of 
14 July 1992 on the protection of geographical indications and designations of origin for agricultural products and 
foodstuffs, as amended on the date of 
establishment of the Panel 
 SCM Agreement, SCM  Agreement on Subsidies and Countervailing 
Duties 
 
Trademarks Directive  First Council Directive 89/104, of 
20 December, on the Community Trademark, as amended on the date of establishment of the Panel  WT/DS174/R/Add.2 
 Page B-27 
 
 
  
TBT Agreement, TBT  Agreement on Technical Barriers to Trade 
 TRIPS Agreement, TRIPS  Agreement on Trade-Related Aspects of 
Intellectual Property Rights 
 
US United States 
 WTO  World Trade Organization 
 
WTO Agreement  Marrakesh Agreement Establishing the 
World Trade Organization WT/DS174/R/Add.2 
Page B-28  
 
 I. INTRODUCTION 
1. This submission provides the response of the European Communiti es to the first written 
submissions filed by Australia and the United States on 25 May 2004.  2. Section II raises a number of issues in connec tion with the terms of reference of the Panel. 
 
3. Section III sets out the content of Regulation 2081/1992 to the extent relevant for the present 
dispute and corrects a number of errors and misrepresen tations made by the complainants in their first 
written submissions.  
4. Section IV addresses the various claims submitte d by the complainants to the effect that 
certain requirements of Regulation 2081/92 are incomp atible with the national treatment obligations 
under Article 3.1 of the TRIPS Agreement, Article 2. 1 of the Paris Convention and Article III:4 of the 
GATT, as well as with the prohibition on requirements of domicile or establishment in Article 2.2 of 
the Paris Convention.  
 
5. Section V addresses the United States' claims that some of those requirements are incompatible with the most-favoured-nation obliga tions under Article 4 of the TRIPS Agreement and 
Article I:1 of the GATT.  6. Section VI deals with the complainants' vari ous claims to the effect that Regulation 2081/92 
diminishes the legal protection of trademarks, th ereby violating Articles 16.1, 20 and 24.5 of the 
TRIPS Agreement, as well as certain provisions of Part III of that Agreement, and Articles 10 bis and 
10ter of the Paris Convention.  
 7. Section VII responds to the claims that the EC  does not comply with the obligation to provide 
protection to geographical indications unde r Article 22.2 of the TRIPS Agreement. 
 8. Finally, Section VIII deals with the claims raised by Australia that Regulation 2081/92 is 
incompatible with certain provisions of the TBT Agreement.  9. For ease of reference, the EC has grouped a nd numbered sequentially the claims submitted by 
the complainants. In each case, the EC has indicated which of the co mplainants has made the claim, 
and referred to the paragraphs of the fi rst submission where the claim is made.  
 
II. TERMS OF REFERENCE 
10. The present Panel has been established by th e DSB on 2 October 2003 with standard terms of 
reference in accordance with Article 7.1 of the DSU.
1 These terms of reference define the Panel's 
scope of jurisdiction.  As the Appellate Body has explained in India – Patents (US) , a panel cannot 
consider claims which are not within its terms of reference:2 
 
The jurisdiction of a panel is established by that panel's terms of reference, which are 
governed by Article 7 of the DSU.  A panel may consider only tho se claims that it has 
the authority to consider under its terms of reference.  A panel cannot assume 
jurisdiction that it does not have.  In this case, Article 63 was not within the Panel's 
                                                      
1 Cf. WT/DS174/21, WT/DS290/19, para. 2. As the EC has set out in its request for a preliminary 
ruling made on 24 February 2004, it considers that the pa nel requests of the United States and of Australia are 
not in compliance with the requirements of Article 6.2 DSU.  The EC reserves the right to raise this issue in the 
context of an appeal. 
2 Appellate Body Report, India – Patents  (US) , para. 92.  WT/DS174/R/Add.2 
 Page B-29 
 
 
 jurisdiction, as defined by its terms of reference. Therefore, the Panel had no 
authority to consider the alternative cl aim by the United States under Article 63. 
11. In its first written submission, Australia is referring to versions of Regulation 2081/92 which 
were no longer in force at the time the Panel's terms of reference were established. Moreover, the 
complainants have referred to a number of measure s that were not yet in existence at the time the 
Panel was established. In the view of the EC, only m easures which were in force at the time that the 
Panel was established are within the terms of reference of the Panel. 
 12. Moreover, Australia and the United States raise a number of claims which are not identified in their requests for the establishment of the Panel. Such claims not identified in the panel requests are 
not within the jurisdiction of the Panel. 
 A. T
HE MEASURE AT ISSUE  
1. Versions of Regulation 2081/92 no longer in force at the time the Panel was established 
13. In its first written submission, Au stralia (but not the United States)3 has referred to several 
versions of Regulation 2081/92 no longer in force.  It has numbered these versions #1 to #3, reflecting 
various subsequent amendments of Regulation 2081/92.4 
 14. Throughout its submission, Australia refers  repeatedly to these different versions of 
Regulation 2081/92. In particular, Australia claims that no right of objection was available to persons 
not resident or established in the EC " until Article 12d (1) of Regulation No 2081/92#3
 changed the 
situation".5 Similarly, Australia refers to the fact th at "Article 17.1 of Regulation No 2081/92#1 and 
#2 provided for a simplified registration process for certain names which were already legally 
protected or established by usage in the Member States".6 
 15. These references to versions of Regulation No . 2081/92 which were no longer in force at the 
time the present Panel was established are not within th e scope of the Panel's terms of reference. This 
already flows from Australia's request for the establishment of the Panel,
7 which is the basis for the 
Panel's terms of reference. In its Panel request, Australia referr ed to "Council Regulation (EEC) No 
2081/92 of 14 July 1992 [...] and any amendments th ereto" as "the EC measure". Australia's request 
did not make it clear that Australia intended to cha llenge as the "EC measure" several versions of the 
same measure resulting from subsequent amendments over time. 
 
16. Moreover, as the Panel in India – Autos recalled, a " WTO Panel is generally competent to 
consider measures in existence at the time of its establishment".8 Accordingly, in WTO practice, 
Panels have declined to examine measures which we re no longer in force at the time the Panel was 
established. In US – Gasoline , the Panel explained the legal situation as follows:9 
 
The Panel observed that it had not been th e usual practice of a panel established under 
the General Agreement to rule on measures that, at the time the panel's terms of 
                                                      
3 The United States has referred to Regulation 2081/92 "as most recently amended" (US FWS, 
footnote 1). 
4 Australia's FWS, para. 18.  
5 Australia's FWS, para. 185 (emphasis added). 
6 Australia's FWS, para. 190 (emphasis added). 
7 WT/DS290/18. 
8 Panel Report, India – Autos , para. 7.26. 
9 Panel Report, US – Gasoline , para. 6.19; similarly, Panel Report, Japan – Film , para. 10.58; Panel 
Report, Argentina – Textiles and Apparel , para. 6.15. WT/DS174/R/Add.2 
Page B-30  
 
 reference were fixed, were not and woul d not become effective.  In the 1978 Animal 
Feed Protein  case, the Panel ruled on a discontinued measure, but one that had 
terminated after agreement on the pane l's terms of reference. In the 1980 Chile Apples  
case, the panel ruled on a measure terminated  before agreement on the panel's terms 
of reference;  however, the terms of reference in that case specifically included the 
terminated measure and, it being a seasonal measure, there remained the prospect of 
its reintroduction. In the present case, the Pa nel's terms of reference were established 
after the 75 percent rule had ceased to have  any effect, and the rule had not been 
specifically mentioned in the terms of refere nce.  The Panel further noted that there 
was no indication by the parties that the 75 percent rule was a measure that, although 
currently not in force, was likely to be rene wed.  Finally, the Panel considered that its 
findings on treatment under the baselin e establishment methods under Articles III:4 
and XX (b), (d) and (g) would in any case have made unnecessary the examination of the 75 percent rule under Article I:1.  The Panel did not therefore proceed to examine this aspect of the Gasoline Rule under Ar ticle I:1 of the General Agreement. 
17. In the present case, there are no specific re asons which could justify an examination of 
versions of Regulation 2081/92 no lo nger in force. From its adopti on in 1992 to the establishment of 
the Panel, Regulation 2081/92 has been amended six times.
10 Australia has arbitrarily chosen certain 
points in time to reflect versions of Regula tion 2081/92 going as far back as 1997 or 1993. 
 18. The same applies also with respect to Australia's reference to the version of Regulation 
2081/92 as applicable before its amendment by Regulation 692/2003 of 8 April 2003.
11 In accordance 
with its Article 2.1, Regulation 69 2/2003 entered into force on 24 Ap ril 2003, i.e. before the present 
Panel was established. The EC has no intention to  repeal Regulation 692/2003, or to remove the 
changes introduced by it. Therefore, Regulation 2081/92 as applicable prior to its amendment by 
Regulation 692/2003 is not within the scope  of the Panel's terms of reference. 
 
19. Moreover, as the Appellate Body has recalled in US – Shirts and Blouses , the purpose of 
Panel proceedings under the DSU is the settleme nt of concrete disputes between the parties:12 
 
Given the explicit aim of dispute settlement that permeates the DSU , we do not 
consider that Article 3.2 of the DSU  is meant to encourage either panels or the 
Appellate Body to "make law" by cl arifying existing provisions of the WTO 
Agreement  outside the context of resolving a particular dispute.  A panel need only 
address those claims which must be addressed in order to resolve the matter in issue in the dispute. 
20. An analysis of historical versions of Re gulation 2081/92 is not useful for the purposes of 
settling the present dispute. Accordingly, the EC s ubmits that the measure at issue in the present 
dispute is Regulation 2081/92 as in force at the time  the Panel was established. A consolidated version 
of Regulation 2081/92 as in force on 2 October 2003 is provided by the EC as Exhibit EC-1.  
2. Measures not yet adopted at the time the Panel was established 
21. The complainants have referred to a number of measures which had not yet been adopted at 
the time the Panel was established. 
 
                                                     
 
10 See consolidated version of Regulation 2081/92, Exihibit EC-1, p. 1. 
11 Exhibit COMP-1i. 
12 Appellate Body Report, US – Shirts and Blouses , p. 22.  WT/DS174/R/Add.2 
 Page B-31 
 
 
 22. In Exhibits COMP-4b (viii) – (xvi), th e complainants are referring to a number of 
amendments to Commission Regulation 2400/96 adopted between 11 November 2003 and 5 April 
2004. These measures did not yet exist at the time the Panel was established, and are therefore outside 
its terms of reference.  
23. Moreover, the complainants have prepared a "consolidated unofficial version" of Regulation 
2081/92, which they provide as Exhibit COMP-1a. Th e complainants state th at this consolidated 
unofficial version incorporates amendments made by the Act of Accession of Cyprus, Czech Republic, Estonia, Hungary, Latvia, Lithuania, Malta , Poland, Slovakia, and Slovenia. Moreover, the 
complainants have also provided an extract from the Act of Accession as Exhibit COMP-3c. 
 
24. In accordance with Article 2.3 of the Treaty of Accession, of which the Act of Accession is an integral part, the Treaty of Accession had to be ra tified by all Member States of the European Union 
and by the acceding countries. At the time the Pane l was established, the process of ratification was 
still ongoing. The Act of Accession entered into force only on 1 May 2004. Accordingly, the Act of 
Accession was not yet adopted at the time the Panel wa s established, and is therefore not within the 
scope of the Panel's terms of reference.  25. Accordingly, the EC submits that measures which had not yet been adopted at the time the 
Panel was established are not within the Panel's terms of reference.  
B. C
LAIMS  
26. In its first written submission, Australia h as raised claims under Article 4 of the Paris 
Convention, and Articles 43 to 49 of the TRIPS Agreem ent. None of these claims is referred to in 
Australia's request for the establishment of the Panel.13 
 
27. Moreover, both Australia and the United Stat es have made claims according to which the EC 
measure imposes a requirement of domicile or resi dence for the enjoyment of intellectual property 
rights contrary to Article 2.2 of the Paris Conventio n. No such claim was rais ed in the panel requests 
of the complainants.14 
 
1. Australia's claim under Article 4 of the Paris Convention 
28. In its first written submission, Australia alle ges that Regulation 2081/92 is incompatible with 
Article 4 of the Paris Convention, incorporated by Article 2.1 TRIPS, which requires that a WTO 
member afford a right of priority of six months in respect of an application for registration of a 
trademark for which an application for registra tion had previously been filed in another WTO 
member.15 
 
29. However, Australia's panel request does not refer to Article 4 of the Paris Convention. 
Australia can also not argue that its reference to Article 2.1 of the TRIPS Agreement, which requires 
Members to comply with Articles 1 through 12 and Ar ticle 19 of the Paris Convention, is sufficient to 
bring Article 4 of the Paris Convention within th e scope of the Panel's terms of reference. The 
incorporated provisions of the Paris Convention cont ain numerous distinct obligations, which need to 
be referred to specifically in order to meet  the requirements of Article 6.2 of the DSU.16 In fact, 
Australia's panel request specifies alongside the re ference to Article 2.1 of the TRIPS Agreement a 
number of other provisions of the Paris Convention a lleged to be violated. However, Article 4 of the 
                                                      
13 WT/DS290/18. 
14 WT/DS290/18; WT/DS174/20. 
15 Australia's FWS, para. 85. 
16 Appellate Body Report, Korea - Dairy , para. 124. WT/DS174/R/Add.2 
Page B-32  
 
 Paris Convention is not among the provisions alleged to have been violated in Australia's panel 
request.  30. Therefore, the EC considers that Australia's claim regarding Article 4 of the Paris Convention 
is outside the terms of reference of the Panel. 
 
2. Australia's claim under Articles 43 to 49 of the TRIPS 
31. In its first written submission, Australia h as claimed that the EC measure has failed "to 
provide the judicial authorities the authority requi red to be conferred on them by TRIPS Articles 43, 
44, 45, 46, 48 and 49 in respect of the enfor cement of trademark rights vis-à-vis the proposed 
registration of an EC-defined GI".
17 
 32. However, Articles 43 to 49 TRIPS Agreement ar e not mentioned in Australia's panel request. 
In its panel request (fifth paragraph, first bullet point), Australia has alleged that the EC measure 
diminishes the legal protection of trademarks, and h as referred in this respect to Articles 41 and 42 
TRIPS. However, Articles 43 through 49 of the TR IPS Agreement contain distinct obligations which 
are separate from and additional to those contained in Articles 41 and 42.  33. Australia cannot argue that a reference to the specific provisions of Articles 43 to 49 TRIPS 
was made redundant by its reference to Article 41 TRIPS. Article 41 is an introductory provision 
contained in the first section, entitled "General Obliga tions", of Part III. It sets out general obligations 
and principles to be respected by the Parties in the application of Part III.  
 34. More specifically, Article 41.1 is a purely  introductory provision which does not create 
separate legal obligations. The fact that Article 41. 1 TRIPS refers to the "enforcement procedures as 
specified in this Part" cannot mean that a reference to Article 41.1 TRIPS would be sufficient to bring 
all the provisions of Part III within the terms of re ference of the Panel. Otherwise, it could be argued 
that a simple reference to Article 1.1 TRIPS is sufficient to bring all provisions of the TRIPS 
Agreement within the scope of a pa nel's jurisdiction, or that a reference to Article XVI:4 WTO would 
bring all provisions of the covere d agreements within the scope of a panel's jurisdiction. Such an 
interpretation would be manifestly incompatible w ith the requirements for panel requests contained in 
Article 6.2 DSU. 
 
35. Accordingly, the EC considers that Australia 's claim under Articles 43 to 49 of the TRIPS is 
outside the terms of reference of the Panel.  
3. The claims regarding Article 2.2 of the Paris Convention 
36. In its first written submission, the United States has argued that with respect to the 
registration of foreign geographical indications, Regulation 2081/92 imposes a requirement as to 
domicile or establishment contrary to  Article 2.2 of the Paris Convention.
18 The United States has 
made a claim based on Article 2.2 of the Paris C onvention also with respect to the conditions under 
which foreign nationals can object to the registration of geographical indications.19  
 
                                                      
17 Australia's FWS, para. 148. 
18 US FWS, para. 84. 
19 US FWS, para. 89.  WT/DS174/R/Add.2 
 Page B-33 
 
 
 37. Australia has made a similar claim based on Ar ticle 2.2 of the Paris Convention with respect 
to the alleged unavailability of a right of objection to  foreign right holders prior to the amendment of 
Regulation 2081/92 by Regulation 692/2003.20 
 38. Article 2.1 and 2.2 of the Paris Convention are drafted as follows: 
 
(1) Nationals of any country of the Union shall, as regards the protection of industrial property, enjoy in all the other countries of the Union the advantages that their respective laws now grant, or may he reafter grant, to nationals; all without 
prejudice to the rights specially provided for by this Convention. Consequently, they 
shall have the same protection as the latter,  and the same legal remedy against any 
infringement of their rights, provided th at the conditions and formalities imposed 
upon nationals are complied with. 
(2) However, no requirement as to domicile or establishment in the country 
where protection is claimed may be imposed  upon nationals of countries of the Union 
for the enjoyment of any industrial property rights. 
39. Article 2.1 of the Paris Convention is c oncerned with national treatment. In contrast, 
Article 2.2 prohibits the imposition of requirements as to domicile or establishment. This obligation is 
different and additional to the obligations r esulting from the national treatment provision of 
Article 2.1 Paris Convention. This is also made clear by the term "however", which indicates that 
Article 2.2 goes beyond what is provided in Article 2.1. 
 
40. This view also seems to be shared by the complainants. In its first written submission, the 
United States has argued that the EC measure "is directly prohibited by Article 2(2) of the Paris Convention".
21 Similarly, Australia has referred to the EC's  obligations pursuant to Article 2(2) of the 
Paris Convention.22 
 
41. However, in their panel requests, the complain ants have merely referred to an alleged failure 
of the EC measure to provide national treatment. They have not raised any issue regarding the 
imposition of a requirement as to domicile or estab lishment contrary to Article 2.2 of the Paris 
Convention.   
42. For this reason, the EC submits that the US  and Australian claims under Article 2.2 of the 
Paris Convention are outside the terms of reference of the Panel.  
III. FACTS 
43. The measure at issue in the present disput e is Council Regulation 2 081/1992 on the protection 
of geographical indications and desi gnations of origin for agricultural products and foodstuffs, as in 
force at the date of establishment of the Panel. A consolidated version of this Regulation is provided 
in Exhibit EC-1.  44. In this section, the EC will set out the c ontent of Regulation 2081/ 1992 relevant for the 
present dispute. In this context, the EC will also correct a number of errors and misrepresentations 
                                                     
 
20 Australia's FWS, para. 189, second bullet point; para. 194, second bullet point. As the EC has already 
set out above, these claims relate to a measure which is no longer in force, and are therefore in any case outside 
the terms of reference of the present panel. 
21 US FWS, para. 85. 
22 Australia's FWS, para. 189, 194. WT/DS174/R/Add.2 
Page B-34  
 
 that are contained in the first written submissions of  the complainants with respect to the content of 
Regulation 2081/1992.  A. T
HE DEFINITION OF GEOGRAPHIC INDICATIONS  
45. Regulation 2081/92 lays down rules on the protection, within the European Community, of 
designations of origin and geographical indicat ions for agricultural products and foodstuffs. 
Article 2(2) of the Regulation defines the terms "d esignation of origin" and "geographical indication" 
as follows:23 
 
(a) designation of origin : means the name of a region, a specific place or, in 
exceptional cases, a country, used to describe an agricultural product or a foodstuff: 
– originating in that region, specific place or country, and – the quality or characteristics of which are essentially or exclusively due to a 
particular geographical environment with its  inherent natural and human factors, and 
the production, processing and preparation of which take place in the defined 
geographical area; 
(b) geographical indication: means the name of a region, a specific place or, in 
exceptional cases, a country, used to describe an agricultural product or a foodstuff: 
– originating in that region, specific place or country, and – which possesses a specific quality, reputation or other characteristics 
attributable to that geographical origin and the production and/ or processing and/or 
preparation of which take place in the defined geographical area.
 
46. The distinction between designations of orig in and geographical indi cations depends on how 
closely the product is linked to the geographical area in which it originates. However, both designations of origin and geographical indications  within the meaning of Regulation 2081/92 are 
geographical indications as defined in Article 22.1 TRIPS Agreement. 
 
47. Under Regulation 2081/92, designations of orig in and geographical indications are subject to 
identical rules as regards their registration and prot ection. For this reason, wherever the EC, in the 
present submission, refers to geographical indications  within the meaning of Regulation 2081/92, this 
reference shall also include designations of origin.  
B. P
RODUCT SPECIFICATIONS  
48. In accordance with Article 4 (1) of Regulati on 2081/92, in order to be eligible to use a 
geographical indication, an agricultural product must comply with a product specification. The purpose of this requirement is to ensure that th e agricultural product marketed using a particular 
geographical indication in fact originates in the ar ea to which the indication is related, and possesses 
the specific quality, reputation or other characteristics which justify the protection of the geographical 
indication.  49. Regulation 2081/92 does not itself define the product specifications w ith which a particular 
product must comply. Rather, in accordance with Article 5 (3) of Regulation 2081/92, the product 
                                                     
 
23 Further specific aspects of these definitions ar e set out in paragraphs 3 to 7 of Article 2.  WT/DS174/R/Add.2 
 Page B-35 
 
 
 specifications must be contained in the applica tion for registration of a geographical indication. 
Article 4 (2) of the Regulation defines the elemen ts with which a product specification must comply: 
 
The product specification shall include at least: 
(a) the name of the agricultural product or foodstuffs, including the designation 
of origin or the geographical indication; 
(b) a description of the agricultural pr oduct or foodstuff including the raw 
materials, if appropriate, and principal ph ysical, chemical, microbiological and/or 
organoleptic characteristics of the product or the foodstuff; 
(c) the definition of the geographical area and, if appropriate, details indicating 
compliance with the requirements in Article 2 (4); 
(d) evidence that the agricultural prod uct or the foodstuff originates in the 
geographical area, within the meaning of Article 2(2) (a) or (b), whichever is 
applicable; 
(e) a description of the method of obtaining the agricultural product or foodstuff 
and, if appropriate, the authentic and unva rying local methods as well as information 
concerning the packaging, if the group ma king the request determines and justifies 
that the packaging must take place in the limited geographical area to safeguard quality, ensure traceability or ensure control; 
(f) the details bearing out the link with  the geographical environment or the 
geographical origin within the meaning of  Article 2(2)(a) or (b), whichever is 
applicable; 
(g) details of the inspection structures provided for in Article 10; (h) the specific labelling details relating to the indication PDO or PGI, whichever 
is applicable, or the equivalent  traditional national indications; 
(i) any requirements laid down by Co mmunity and/or national provisions. 
C. I
NSPECTION STRUCTURES  
50. As has been explained, each protected geogra phical indication has to comply with a product 
specification. However, a geographical indication is less reliable and informative for consumers if its 
proper use is not ensured by an effective inspec tion regime. For this reason, Article 10(1) of 
Regulation 2081/92 provides that EC Member States shall ensure that inspection structures are in 
place, the function of which shall be to ensure that agricultural products and foodstuffs bearing a 
protected name meet the requirements laid down in the specifications.  
 51. Article 10 does not regulate all details of such inspection structures. In particular, 
Article 10(2) provides that an inspection structure "may comprise one or more designated inspection 
authorities and/or private bodies". It thereby leav es the Member State a choice between public and 
private elements in the design of the inspection bodies. 
 52. Article 10(3) further provides that designate d inspection authorities and/or approved private 
bodies "must offer adequate guarantees of objectivity a nd impartiality with regard to all producers or 
processors subject to their control and have perm anently at their disposal the qualified staff and WT/DS174/R/Add.2 
Page B-36  
 
 resources necessary to carry out inspection of agricult ural products and foodstuffs bearing a protected 
name".  53. Further, the third subparagra ph of Article 10(3) provides that in order to be approved by the 
Member States, private bodies mu st fulfil the requirements laid down in standard EN 45011 of 26 
June 1989, which sets out general requirements fo r bodies operating product certification systems. A 
copy of this standard, which is available from CEN/CENELEC, is provided as Exhibit EC-2. 
 54. It should be noted that compliance with st andard EN 45011 is only required for bodies to be 
approved by the EC Member States. In accordance w ith the last subparagraph of Article 10(3), for 
bodies located outside the Community, compliance with  equivalent international standards will be 
sufficient. An example for an equivalent internati onal standard is ISO/IEC Guide 65:1996 (E), a copy 
of which is provided as Exhibit EC-3.  55. In accordance with Article 4(2)(g) of Regula tion 2081/92, details of the inspection structure 
applicable must be included in the product speci fication, which is part of any application for 
registration of a geographical indication.  D. T
HE REGISTRATION OF GEOGRAPHICAL INDICATIONS RELATING TO AN AREA LOCATED IN 
THE EC 
56. Articles 5 and 6 of Regulation 2081/92 set  out the procedure for the registration of 
geographical indications which relate to a geogra phical area located in th e European Community.  
 57. In accordance with Article 5(4) of Regulation 2081/92, the application shall be sent to the EC 
Member State in which the geographical area is lo cated. In accordance with Article 5(5), the Member 
State shall check that the application is justified a nd, if it considers that the application fulfils the 
requirements of the Regulation, shall forward the a pplication, including the product specification and 
all other relevant documents to the EC Commission.  58. This involvement of the Member State in the registration process is crucial for the proper implementation of the Regulation. In fact, Member States are particularly well placed to examine the admissibility of applications relating to geographical areas located on their territory. 
 
59. Within six months of the receipt of the a pplication, the EC Commission shall verify, by 
means of a formal investigation, whether the re gistration application includes all the particulars 
provided for in Article 4 of the Regulation. If, af ter this examination, the Commission concludes that 
the name qualifies for protection, it shall publish a notice in the Official Journal of the European 
Union containing among others the name of the applicant, the name of the product, and the main 
points of the application (Article 6(2) of the Regulation).  60. If no statement of objection is notified to th e Commission in accordance with Article 7 of the 
Regulation, the name shall be entered in the regi ster of protected names kept by the Commission 
(Article 6(3) of the Regulation). The name entered in the register shall be published in the Official 
Journal (Article 6.4 of the Regulation). 
 61. If, in the light of the investigation provide d for in Article 6(1) of the Regulation, the 
Commission concludes that the name does not qualify  for protection, it shall decide, in accordance 
with the procedure provided for in Article 15 of the Regulation, not to proceed with the registration of 
the name. 
  WT/DS174/R/Add.2 
 Page B-37 
 
 
 E. THE REGISTRATION OF GEOGRAPHICAL INDICATIONS RELATING TO AN AREA LOCATED 
OUTSIDE THE EC 
62. Regulation 2081/92 also applies to geographi cal indications relating to areas located outside 
the EC. For this purpose, the Regulation lays do wn rules relating to the registration of such 
geographical indications from outside the EC whic h closely parallel the provisions applicable to 
geographical indications from inside the EC. 
 63. The purpose of these specific rules, some of which were introduced by Regulation 692/2003, 
is to facilitate the registration of  non-EC geographical indications while  at the same time ensuring that 
geographical indications from outside the EC correspond to the definition of a geographical 
indication. 
 64. The United States and Australia have claimed that Regulation 2081/92 allows the registration 
of geographical indications from other WTO memb ers only under the condition of "reciprocity and 
equivalence".
24 In support of this contention, they have  relied on Article 12(1) of the Regulation, 
which provides as follows: 
 
Without prejudice to international agreem ents, this Regulation may apply to an 
agricultural product or foodstuff from a third country provided that: 
– the third country is able to give gua rantees identical or equivalent to those 
referred to in Article 4, 
– the third country concerned has inspection arrangements and a right to 
objection equivalent to those laid down in this Regulation, 
– the third country concerned is prepared  to provide protection equivalent to 
that available in the Community to corres ponding agricultural products for foodstuffs 
coming from the Community. 
65. However, this interpretation is based on a misunderstanding of the Regul ation.  Article 12(1) 
of Regulation 2081/92 clearly provides that it appli es "without prejudice to international agreements". 
Such international agreements include the WT O Agreements. This is made clear by the 8th recital of 
Regulation 692/2003,25 which amended the procedures for the registration of non-EC geographical 
indications, and in this context took specific account of the provisions of the TRIPS.  
66. WTO Members are obliged to provide protec tion to geographical indications in accordance 
with Section 3 of Part II and the general provisions  and basic principles of the TRIPS Agreement. For 
this reason, Article 12(1) and (3) of Regula tion 2081/92 do not apply to WTO Members. This 
distinction between WTO countries and other third c ountries is also found in other provisions of the 
Regulation, for instance in Article 12(2)(a) and (b ) and in Article 12d(1), both concerning objections 
from outside the EC. 
 67. Accordingly, the registration of a geographical indication relating to an area located in the territory of another WTO Member does not require that the Commission examines whether the conditions set out in Article 12(1) of the Regula tion are fulfilled. Rather, the procedure for the 
registration of third country geographical indications  can be immediately applied. The applicant shall 
therefore send the registration application to the authorities in the country in which the geographical 
area is located (Article 12a(1) of the Regulati on). Like applications for registration of EC 
                                                     
 
24 US FWS, para. 22; Australia's FWS, para. 170. 
25 Exhibit COMP-1h. WT/DS174/R/Add.2 
Page B-38  
 
 geographical indications, applications must be ac companied by the specification referred to in 
Article 4.  68. According to Article 12a(2), if the thir d country deems that the requirements of the 
Regulation are satisfied, it shall transmit the registration application to the Commission accompanied 
by the following: 
 
(a) a description of the legal provisions an d the usage on the basis of which the 
designation of origin or the geographical indication is protected or established in the country, 
(b) a declaration that the structures provided for in Article 10 are established on 
its territory, and 
(c) other documents on which it has based its assessment.
 
69. Article 12b regulates the further procedure for the registration of the geographical indication 
in a way which corresponds closely to the procedure set out in Article 6 for the registration of 
geographical indications from inside the EC.26 
 F. O
BJECTIONS FROM PERSONS RESIDE NT OR ESTABLISHED IN THE EC 
70. Within six months of the date of publication of the application in the Official Journal, the 
Member State may object to the registration. Artic le 7(2) of the Regulation provides that Member 
States shall ensure that all persons who can demonstrate a legitimate economic interest are authorised 
to consult the application. Pursuant to Article 7(3) of the Regulation, any legitimately concerned 
natural or legal person may object to a proposed regi stration by sending a duly  substantiated statement 
to the competent authority of the Member State in  which he resides or is established, who shall 
transmit the objection to the Commission.  
71. According to Article 7 (4) of the Regulation, a statement of objection shall be admissible only 
if it:  
either shows non-compliance with the c onditions referred to in Article 2, 
– shows that the registration of the name proposed would jeopardize the 
existence of an entirely or partly identical  name or of a mark or the existence of 
products which have been legally on the market for at least five years preceding the 
date of the publication provided for in Article 6(2). 
– or indicates the features which demonstrate that the name whose registration 
is applied for is generic in nature. 
72. Where a statement of objection is admissi ble, the Commission shall proceed in accordance 
with Article 7(5): 
 
Where an objection is admissible within the meaning of paragraph 4, the Commission 
shall ask the Member States concerned to seek agreement among themselves in 
accordance with their internal pro cedures within three months. If: 
                                                     
 
26 See above paragraph 59 et seq.  WT/DS174/R/Add.2 
 Page B-39 
 
 
 (a) agreement is reached, the Member St ates in question shall communicate to 
the Commission all the factors which made  agreement possible together with the 
applicant's opinion and that of the objecto r. Where there has been no change to the 
information received under Article 5, th e Commission shall pro ceed in accordance 
with Article 6(4). If there has been a change , it shall again initiate the procedure laid 
down in Article 7; 
(b) no agreement is reached, the Commissi on shall take a decision in accordance 
with the procedure laid down in Article 15,  having regard to traditional fair practice 
and of the actual likelihood of confusion. Should it decide to proceed with registration, the Commission shall carry out publication in accordance with 
Article 6(4). 
G. O
BJECTIONS FROM PERSONS RESIDENT  OR ESTABLISHED OUTSIDE THE EC 
73. Article 12d(1) of Regulation 2081/92 provides a right of objection to persons not resident or 
established in the EC. Article 12d(1) is drafted as follows:  
Within six months of the date of the notice in the Official Journal of the European 
Union specified in Article 6(2) relating to a registration application submitted by a 
Member State, any natural or legal person th at has a legitimate interest and is from a 
WTO member country or a third country r ecognised under the procedure provided for 
in Article 12(3) may object to the proposed registration by sending a duly substantiated statement to the country in whic h it resides or is established, which shall 
transmit it, made out or translated into  a Community language, to the Commission. 
Member States shall ensure that any pers on from a WTO member country or a third 
country recognised under the procedure provided for in Article 12(3) who can demonstrate a legitimate economic interest is  authorised to consult the application.
 
74. Australia and the US have claimed that this right of objection is subject to the condition that 
the individual concerned is from a country which is recognised as fulfilling the conditions of 
Article 12(1) of the Regulation.27 This is wrong. Article 12d(1) of the Regulation refers to any person 
that "is from a WTO Member or a third country recognised under the procedure provided for in Article 12(3)". The phrase "recognised under the pro cedure provided for in Article 12(3)" only refers 
to third countries other than WTO Members. Othe rwise, the specific reference to WTO Members 
would be meaningless. WTO Members are therefore not subject to the pro cedure of Article 12(3) 
applicable to other third countries.  
 75. This is also clear in Article 12b(2) of th e Regulation, which concerns objections against 
applications for registration of geographical indica tions relating to an area outside the EC. As regards 
WTO Members, Article 12b(2)(a) simply provi des that Article 12d shall apply; whereas 
Article 12b(2)(b) requires for persons resident or established in third countries that the requirements 
of Article 12(3) must be met.  76. In accordance with Article 12d(2), the cond itions for the admissibility of objections from 
outside the EC are those laid down in Article 7(4)  for objections from inside the EC. The admissibility 
conditions and the further procedure with respect to  objections from outside the EC do not differ from 
those applicable to objections from inside the EC.  
 77. The United States has nonetheless seen a differen ce in the fact that whereas under Article 7(3) 
of the Regulation, only persons who are "legitimatel y concerned" may object to an application, under 
                                                     
 
27 US FWS, para. 27, 92; Australia's FWS, para. 204. WT/DS174/R/Add.2 
Page B-40  
 
 Article 12d, persons from outside the EC must have a "legitimate interest".
28 According to the US, "it 
would appear" that the requirement to be "legitimatel y concerned" is a lower standard than that one 
has a "legitimate interest".29 
 78. This assumption of the United States is wrong. There is no substantive difference between the 
two expressions "legitimately concerned" and "legiti mately interested". The New Shorter Oxford 
English Dictionary defines "concerned" as: "interested
, involved, troubled, anxious, showing 
concern".30 In other words, "interested" and "concerned"  are synonyms. The terminological difference 
raised by the United States is therefore without any substantive relevance, and does not imply a 
different standard applicable to persons  resident or established outside the EC. 
 
H. DECISION -MAKING PROCEDURES UNDER THE REGULATION  
79. In its first written submission, Australia has consistently misrepresen ted the decision-making 
process applicable under Regulation 2081/92. In par ticular, it has referred to the "Committee of EC 
Member States representatives" as the "decision-making process established by Article 15 of 
Regulation 2081/92".31 Consequently, it has repeatedly referre d to decisions taken according to the 
procedure set out in Article 15 of the Regulation as decisions taken "in the Committee of EC Member 
States representatives".32 Finally, Australia has referred to the Committee of EC Member States as the 
"ultimate decision-maker" under the Regulation.33  
 80. These statements are based on a misconcep tion of the decision-making process under the 
Regulation, and have the effect of exaggerating the role of the Committee. Under the Regulation, 
decisions with respect to the registration of geographical indications are in principle taken by the Commission. In certain cases, for instance where a statement of objection has been received or the 
Commission considers that a name does not qualify for protection, the Commission must act in accordance with the procedure in Article 15 of the Regulation.
34 Article 15 provides the following:  
 
1. The Commission shall be assisted by a committee. 
2. Where reference is made to this Article, Articles 5 and 7 of Decision 
1999/468/EC shall apply.  
The period laid down in Article 5(6) of Decision 1999/468/EC shall be set at three 
months. 
3. The Committee shall adopt its Rules of Procedure.  
81. Decision 1999/46835 is a decision which lays down, on a general level, the procedures for the 
exercise of implementing powers which the Council may delegate to the Commission in application 
of Article 202 of the EC Treaty. The procedure wh ich is applicable under Regulation 2081/92 is the 
regulatory procedure set out in Article 5 of Decision 1999/468.  
 
82. According to Article 5(1) of Decision 1999/468, the Commission is assisted by a Committee 
composed of representatives of the Member States. In  accordance with Article 5(2) of the Decision, 
                                                      
28 US FWS, para. 26-27. 
29 US FWS, para. 94. 
30 New Shorter Oxford English Dictionary, 1993, Vol. 1, p. 467 (emphasis added). 
31 Australia's FWS, para. 19. 
32 E.g. Australia's FWS, para. 32, 44, 46,  
33 Australia's FWS, para. 94. 
34 Cf. Article 6(5), 7(5), 12b(1)(b), 12d(3) of the Regulation. 
35 Exhibit EC-4.  WT/DS174/R/Add.2 
 Page B-41 
 
 
 the Commission shall submit to the Committee a draft of the measures to be taken. If the measure is in 
accordance with the opinion of the Committee, the Commission adopts the Measures (Article 5(3) of 
the Decision). Only exceptionally, if the measur e is not in accordance with the opinion of the 
Committee, may the matter be referred to the Counc il of Ministers (Article 5(4) of the Decision). In 
this case, the following procedure applies (Article 5(5) of the Decision): 
 
The Council may, where appropriate in view  of any such position, act by qualified 
majority on the proposal, within a period to be  laid down in each basic instrument but 
which shall in no case exceed three months from the date of referral to the Council.  
If within that period the Council has indicated by qualified majority that it opposes 
the proposal, the Commission shall re-examine it. It may submit an amended proposal 
to the Council, re-submit its proposal or present a legislative proposal on the basis of the Treaty. 
If on the expiry of that period the Council has neither adopted the proposed 
implementing act nor indicated its opposition to the proposal for implementing 
measures, the proposed implementing act shall be adopted by the Commission. 
83. Consequently, the decision-maker under the Regulation is the Commission, or exceptionally 
the Council of Ministers. The Committee assists th e Commission, but does not take decisions; it may, 
however, achieve that a proposal is re ferred to the Council of Ministers. 
 I. T
HE PROTECTION OF GEOGRAPHICAL INDICATIONS  
84. According to Article 13(1) of the Regulation,  a name registered under the regulation shall be 
protected against:  
Registered names shall be protected against: 
(a) any direct or indirect commercial use of a name registered in respect of 
products not covered by the registration in so  far as those products are comparable to 
the products registered under that name or  insofar as using the name exploits the 
reputation of the protected name; 
(b) any misuse, imitation or evocation, even  if the true origin of the product is 
indicated or if the protected name is translated or accompanied by an expression such as 'style', 'type', 'method', 'as produced in', 'imitation' or similar; 
(c) any other false or misleading indication as to the provenance, origin, nature 
or essential qualities of the product, on the inner or outer packaging, advertising material or documents relating to the pr oduct concerned, and the packing of the 
product in a container liable to convey a false impression as to its origin;  
(d) any other practice liable to mislead the public as to the true origin of the 
product.
 
J. INDICATION OF THE COUNTRY OF ORIGIN FOR HOMONYMOUS GEOGRAPHICAL INDICATIONS  
85. In their first written submission, the United St ates has claimed that Article 12(2) requires that 
any use of a geographical indication in connectio n with products of other WTO Members can be WT/DS174/R/Add.2 
Page B-42  
 
 authorized only if the country of origin "is clearly and visibly indicat ed on the label", and that there is 
no similar requirement with respect to products of EC Member States.
36 
 86. This interpretation is based on a misundersta nding of Article 12(2) of the Regulation. This 
provision is drafted as follows: 
 
If a protected name of a third country is identical to a Community protected name, 
registration shall be granted with due regard for local and traditional usage and the practical risks of confusion. 
Use of such names shall be authorized only if the country of origin of the product is 
clearly and visibly indicated on the label. 
87. It follows clearly from the structure of this pr ovision that the reference to "such names" in the 
second subparagraph of Article 12(2) is a reference to the names men tioned in the first subparagraph, 
i.e. identical protected names from a third country  and the Community. In other words, the second 
subparagraph does not concern third countr y names in general, but only homonyms. 
 
88. Moreover, it should be noted that the referen ce to "such names" applies both to third country 
protected names and to Community protected names.  In the case of identical names, the requirement 
to indicate the country of origin can apply both to  the third country name and the Community name. 
In practice, this would mean that whichever indica tion is registered later would normally be required 
to indicate the country of origin. Where a Community indication is registered after an identical third 
country indication, the Community indication would therefore be required to indicate the country of 
origin.  89. Finally, it should be noted that in case of homonymous names from the EC, the last indent of 
Article 6(6) of the Regulation also requires "a clear distinction in practice" between the two 
homonyms. Where the two homonyms are from different Member States, this may in practice require 
the indication of the country of origin.  K. G
EOGRAPHICAL INDICATIONS AND TRADEMARKS  
90. The relationship between geographical indicati ons and trademarks is regulated in Article 14 
of the Regulation, which is drafted as follows: 
 
1. Where a designation of origin or geographical indication is registered under this Regulation, any application for registrati on of a trademark that is for a product of 
the same type and use of which will enge nder one of the situations indicated in 
Article 13 shall be refused if made after th e date of submission to the Commission of 
the application for registration of the designa tion of origin or geographical indication. 
Trademarks registered in breach of the first subparagraph shall be invalidated. 
2. With due regard to Community law, a trademark the use of which engenders 
one of the situations indicated in Artic le 13 and which has been applied for, 
registered, or established by use, if that possibility is provided for by the legislation concerned, in good faith within the territory  of the Community, before either the date 
of protection in the country of origin or the date of submissi on to the Commission of 
the application for registration of the designa tion of origin or geographical indication, 
                                                     
 
36 US FWS, para. 25. Australia rightly assumed that this provision only applies to homonyms 
(Australia's FWS, para. 235).   WT/DS174/R/Add.2 
 Page B-43 
 
 
 may continue to be used notwithstanding th e registration of a designation of origin or 
geographical indication, provided that no gr ounds for its invalidity or revocation exist 
as specified by Council Directive 89/104/EEC  of 21 December 1998 to approximate 
the laws of the Member States relating to trade marks and/or Council Regulation (EC) 
No 40/94 of 20 December 1993 on the Community trade mark. 
3. A designation of origin or geographi cal indication shall not be registered 
where, in the light of a trade mark's reputation and renown and the length of time it has been used, registration is liable to mislea d the consumer as to the true identity of 
the product. 
L. S
IMPLIFIED REGISTRATION OF GEOGRAPHICAL I NDICATIONS PRIOR TO THE ENTRY INTO FORCE 
OF REGULATION  692/2003 
91. In its first written submission,  Australia has also made certain claims regarding the simplified 
registration procedure according to Article 17 of Re gulation 2081/92 as applicable until the entry into 
force of Regulation 692/2003.  
92. As the Commission has already set out, these clai ms relate to a measure no longer in force at 
the time the Panel was established, and are therefore outside the terms of reference of the present Panel.
37 However, since certain of the factual claims ma de by Australia in this respect are factually 
wrong, the EC would like to take the opportunity to correct them.  93. In its first written submission, Australia claims  that under the simplified procedure, a right of 
objection was available to persons resident or est ablished in the EC, which was not available to 
persons from outside the EC.
38 In support of its thesis, it relies in particular on a declaration of the 
Commission and the Council quoted in the Feta judgment of the European Court of Justice.39 
 94. Australia's interpretation is unfounded. Article 17, as applicable  until the entry into force of 
Regulation 692/2003, provided as follows (emphasis added): 
 
Within six months of the entry into force of the Regulation, Member States shall inform the Commission which of their legally  protected names or, in those Member 
States where there is no protection system, wh ich of their names established by usage 
they wish to register pursuant to this Regulation. 
In accordance with the procedure laid dow n in Article 15, the Commission shall 
register the names referred to in paragr aph 1 which comply with Articles 2 and 4. 
Article 7 shall not apply.
 However, generic names shall not be added. 
95. Article 17(2) thus provided clearly that Article  7, which laid down the right of objection, did 
not apply in the simplified procedure. This was exp licitly confirmed by the European Court of Justice 
in the Feta judgment:40 
 
Second, as the Commission itself pointed out in its defence in Case C-293/96, it must 
be noted that, even though Article 17(2) of the basic regulation expressly provides that Article 7 thereof is not applicable in the simplified registration procedure, a 
registration under that procedure also pr esupposes that the names conform with the 
                                                     
 
37 See above, para. 13 et seq. 
38 Australia's FWS, para. 39, 191-192. 
39 The declaration was quoted in para. 21 of the Court's judgment (Exhibit COMP-11). 
40 Paragraph 92 of the Judgment (Exhibit COMP-11; emphasis added). WT/DS174/R/Add.2 
Page B-44  
 
 substantive requirements of that regulati on. In the absence of express provisions to 
the contrary, there is no possibility, under the simplified procedure, of names being 
registered which do not fulfil the substa ntive conditions for registration under the 
normal registration procedure. 
96. Furthermore, the declaration of the Council and the Commission referred to by the Court of 
Justice did not concern the simplified procedure of Artic le 17.  The declaration re ad in relevant part as 
follows:
41 
 
The Council and the Commission further decl are that where ther e are agriculture 
products or foodstuffs already being legally  marketed before the making of this 
Regulation which may be the subject of an application for registration, it has been 
provided for any Member States to object to the registration under the provisions of Article 7 of the Regulation [...]. 
97. This declaration simply referred to the situa tion envisaged in the second indent of Article 7(4) 
of Regulation 2081/92, in which a statement of objec tion will be admissible. This declaration did in 
no way refer to the simplified procedure foreseen in Ar ticle 17. Nor did the European Court of Justice, 
as shown above, deduce from this declaration that a right of objection applied in the context of the 
simplified procedure.  98. In accordance with the clear wording of Ar ticle 17(2) of Regulation as applicable until the 
entry into force of Regulation 692/2003, the right of objection did not apply in the context of the 
simplified procedure. 
 
IV. REGULATION 2081/92 IS COMPATIB LE WITH NATIONAL TREATMENT 
OBLIGATIONS, AND DOES NOT IMPOSE A REQUIREMENT OF DOMICILE OR ESTABLISHMENT 
99. In their first written submissions, the compla inants have claimed that Regulation 2081/92: 
 
• is incompatible with the national treatme nt obligation of the TRIPS and the Paris 
Convention (Article 3.1 TRIPS and Article 2.1 TRIPS in conjunction with Article 2.1 
Paris Convention); 
 
• establishes a requirement of domicile or  establishment prohibited by the Paris 
Convention (Article 2.1 TRIPS in conjunc tion with Article 2.2 Paris Convention); 
 
• is incompatible with the national treatment obligation of Article III:4 GATT. 
 100. The EC will discuss the claims under each of these provisions in turn.  A. N
ATIONAL TREATMENT UNDER THE TRIPS  AGREEMENT (ARTICLE  3.1 TRIPS  AND 
ARTICLE  2.1 TRIPS  IN CONJUNCTION WITH ARTICLE  2.1 PARIS CONVENTION ) 
101. Under the TRIPS Agreement, the obligation to provide national treatment with regard to the 
protection of intellectual property is set out in two different provisions. First, Article 3.1 TRIPS 
provides as follows:  
Each Member shall accord to the nationals of other Members treatment no less 
favourable than that it accords to its own na tionals with regard to the protection of 
                                                     
 
41 Exhibit EC-5.  WT/DS174/R/Add.2 
 Page B-45 
 
 
 intellectual property, subject to the excepti ons already provided in, respectively, the 
Paris Convention (1967), the Berne Conven tion (1971), the Rome Convention or the 
Treaty on Intellectual Property in Respect of Integrated Circuits.  In respect of performers, producers of phonograms and br oadcasting organizations, this obligation 
only applies in respect of the rights provi ded under this Agreement.  Any Member 
availing itself of the possibilities provided in Article 6 of the Berne Convention 
(1971) or paragraph 1(b) of Article 16 of the Rome Convention shall make a 
notification as foreseen in those pr ovisions to the Council for TRIPS. 
102. Moreover, Article 2.1 TRIPS integrates into  the TRIPS Agreement the national treatment 
provision contained in Article 2.1 of the Paris Convention. Article 2.1 of the Paris Convention reads 
as follows: 
 
Nationals of any country of the Union sha ll, as regards the protection of industrial 
property, enjoy in all the other countri es of the Union the advantages that their 
respective laws now grant, or may hereafte r grant, to nationals; all without prejudice 
to the rights specially provided for by this  Convention. Consequently, they shall have 
the same protection as the latter, and the same legal remedy against any infringement of their rights, provided that the conditi ons and formalities imposed upon nationals 
are complied with. 
103. Since both obligations are expressed in similar terms, the EC shall discuss the claims made by 
the complainants under both provisions jointly. 
 
1. General remarks 
104. Both Article 3.1 TRIPS and Article 2.1 Paris Convention oblige WTO Members to treat 
nationals of other Member no less favourably than th eir own nationals with respect to the protection 
of intellectual property rights. In US – Section 211, the Appellate Body has underlined the 
fundamental significance of the national treatment  obligation within the context of the TRIPS.
42 In its 
first written submission, the United States has reca lled this fundamental importance of the national 
treatment obligation under the TRIPS.43 The EC agrees.  
 105. However, the EC considers it equally importa nt to understand the correct scope and meaning 
of the national treatment provisions of the TRI PS and the Paris Convention. Article 3.1 TRIPS 
provides that each Member shall accord to the nationals
 of other Members treatment no less 
favourable than that it accords to its own nationals . Similarly, Article 2.1 of the Paris Convention 
provides that nationals  of any country of the Union shall, as regards the protection of industrial 
property, enjoy in all the other countries of the Un ion the advantages that their respective laws now 
grant, or may hereafter grant, to nationals . Accordingly, the national tr eatment obligation under the 
TRIPS aims at an equality of treatment between nationals .44 
 106. This reference to nationals is of fundamental importance in the application of the national 
treatment provision under the TRIPS. This is  illustrated by the findings of the Panel in Indonesia – 
Cars . In this case, the United States had argued that the Indonesian system put the United States 
companies in a position that, if they were succ essful in becoming a partner in the National Car 
Programme, they would be unlikely to use in I ndonesia the mark normally used ("global" mark) on 
the vehicle marketed as a "national motor vehicle" in Indonesia, for fear of creating confusion. The 
                                                     
 
42 Appellate Body Report, United States – Section 211 , para. 241. 
43 US FWS, para. 33. 
44 Daniel Gervais, The TRIPS Agreement, Drafting History and Analysis , (Sweet & Maxwell, 1998), 
p. 48. WT/DS174/R/Add.2 
Page B-46  
 
 Panel rejected this claim referring explicitly to th e fact that no evidence had been brought to support 
the conclusion that the Indonesian system  constituted discrimination between nationals
:45 
 
We do not accept this argument for the fo llowing reasons.  First, no evidence has 
been put forward to refute the Indonesian statement that the system, in requiring a 
new, albeit Indonesian-owned, trademar k to be created, applies equally to 
pre-existing trademarks owned by Indon esian nationals and foreign nationals .  
Second, if a foreign company enters into an  arrangement with a Pioneer company, it 
would do so voluntarily, with knowledge of  any consequent implications for its 
ability to maintain pre-existing trademark rights [...]. 
107. The emphasis put by the TRIPS Agreement on nationals is not accidental. In Article 3.1 
TRIPS and 2.1 Paris Convention, national treatment is provided "with regard to the protection of 
intellectual property". Intellectual property ri ghts are held by natural and legal persons.46 It is 
therefore entirely consistent with the object and purpose of the national treatment provision of TRIPS 
that national treatment be  granted between nationals . 
 
108. In this regard, the national treatment oblig ation of the TRIPS differs fundamentally from 
national treatment in the GATT. Article III:4 of the GATT provides that "the products  of the territory 
of any contracting party imported into the territory  of any other contracting party shall be accorded 
treatment no less favourable than that accorded to like products  of national origin". Accordingly, 
unlike Article 3.1 TRIPS and 2.1 Paris Conventi on, Article III:4 GATT prescribes national treatment 
between goods, not between nationals. 
 109. The Panel in Indonesia – Autos in fact cautioned against reading Article 3.1 TRIPS so as to 
apply to matters not directly related to the equal treatment of nationals:
47 
 
In considering this argument, we note th at any customs tariff, subsidy or other 
governmental measure of support could have a "de facto" effect of giving such an 
advantage to the beneficiaries of this support.   We consider that considerable caution 
needs to be used in respect of "de facto"  based arguments of this sort, because of the 
danger of reading into a provision obligati ons which go far beyond the letter of that 
provision and the objectives of the Agreement.   It would not be reasonable to 
construe the national treatment obligation of  the TRIPS Agreement in relation to the 
maintenance of trademark rights as preventing the grant of tariff, subsidy or other measures of support to national companies on the grounds that this would render the 
maintenance of trademark rights by forei gn companies wishing to export to that 
market relatively more difficult. 
110. The United States and Australia fail to acknow ledge this fundamental difference between the 
national treatment obligations  of the TRIPS and the GATT.
48 In their first written submissions, they 
make no attempt to establish that Regula tion 2081/92 discriminates between nationals  of the EC and 
nationals  of other WTO members. 
                                                      
45 Panel Report, Indonesia – Cars , para. 14.271 (emphasis added). The United States is therefore wrong 
to claim that US – Section 211 has been the only dispute concerning the national treatment obligation in the 
context of the TRIPS Agreement (US FWS, para. 34). 
46 On the definition of nationality in this respect, cf . Bodenhausen, Guide to the Application of the Paris 
Convention for the Protection of Industrial Property, p. 27-28 (1968). 
47 Panel Report, Indonesia – Autos , para. 14.723 (emphasis added). 
48 This is all the more striking since the US, when discussing the most-favored-nation obligation under 
the TRIPS and the GATT, did distinguish between treatment of nationals and treatment of products (US, FWS, 
para. 108).  WT/DS174/R/Add.2 
 Page B-47 
 
 
  
111. As the EC will show, Regulation 2081/92 do es not discriminate between EC nationals and 
nationals of other WTO members.   112. Moreover, the EC will show for each of the claims raised that, even if Regulation 2081/92 
applied differently to foreign and EC nationals, it could not be cons idered as providing less favourable 
treatment.  
2. Claims 1: Non-EC nationals are accorded less favorable treatment than EC nationals 
with respect to the registration of geographi cal indications through the application of a 
condition of reciprocity and equivalence  
113. The US and Australia have claimed that by subjecting the registration of geographic 
indications from other WTO members to "cond itions of reciprocity and equivalence", 
Regulation 2081/92 violates the national treatment provisions of Article 3.1 TRIPS and 2.1 Paris 
Convention.
49 
 
114. This claim is wrong for the following reasons:  
• The EC does not apply a condition of reciprocity and equivalence for the registration 
of geographical indications from other WTO members; 
 
• The conditions for the registration of individual geographical indications do not 
constitute less favourable treatment; 
 
• The conditions for the registration of geographical indications do not depend on 
nationality. 
 (a) The EC does not apply a condition of reciproc ity and equivalence for the registration of 
geographical indications from other WTO members 
115. The United States and Australia have allege d that Article 12(1) of Regulation 2081/92 
subjects the registration of foreign geographical indications to a condition of "reciprocity and 
equivalence". In particular, the United States has ar gued that in order to ensure the protection of 
geographical indications relating to areas in other WTO Members, the EC requires them to (a) reciprocally grant equivalent GI protection for agricultural products and foodstuffs coming from the 
EC and (b) adopt a system for protecting geographical  indications that the EC unilaterally decides is 
equivalent to that in the EC, including equivalent inspection and objection systems.
50  
 116. As the EC has already set out previ ously, this claim is factually incorrect.
51 WTO Members 
must provide adequate protec tion of geographical indications in accordance with the TRIPS 
Agreement. For this reason, Article 12(1) of Regulation 2081/92, which applies only subject to 
international agreements, does not apply to other WTO Members.52 
 117. Accordingly, the EC does not condition the regi stration of geographical indications relating to 
the territory of another WTO Member to the conditi on that it reciprocally grant equivalent protection 
                                                     
 
49 US FWS, para. 57 et seq. It appears that Australia  has also attempted to raise the same claim, albeit 
in less clear form (Australia's FWS, para. 199). 
50 US FWS, para. 59. 
51 Above para. 62 et seq. 
52 Above para. 62 et seq. WT/DS174/R/Add.2 
Page B-48  
 
 for agricultural products and foodstuffs coming from th e EC and that it adopts a system for protecting 
geographical indications equivalent to that in the EC.  (b) The conditions for the registration of indivi dual geographical indica tions do not constitute 
less favourable treatment 
118. However, the EC would like to clarify that wh ereas it does not require equivalence as regards 
the system of protection of geographical indications, it does require that the product specifications and 
inspection regimes with regard to specific geogr aphical indications from third countries meet the 
conditions of Regulation 2081/92. Fo r this reason, any application for a geographical indication 
relating to an area in a third country must be  accompanied by a product specification, and must 
indicate that the necessary inspection procedures exist.
53 
 119. It is not entirely clear to the EC whethe r the complainants are also challenging these GI-
specific requirements. The EC notes, however, that in its submission, the United States has frequently 
referred to the notion of "equivalence" without any further qualification, and has claimed that the 
national treatment obligation was specifically  intended to prohibit such a condition.
54 
 120. In case the complainants should also challenge  these GI-specific requirements, the EC would 
like to clarify that it considers that this interpre tation would be erroneous. Article 3.1 TRIPS and 2.1 
Paris Convention oblige WTO Members to provide "tr eatment no less favourable" to the nationals of 
other WTO Members; they do no oblige WTO Memb ers to provide treatment more favourable. 
 
121. As the EC has also explained, the objective of the product specification and the inspection regimes foreseen in Regulation 2081/92 is to ensure  that the products meet the requirements that can 
be expected from products marketed using the protected name.
55 These considerations apply to 
protected names from the EC and from third countries alike. Therefore, the requirement in Regulation 
2081/92 of an assurance that the product specifications  regarding a foreign geographical indication are 
respected is not less favourable treatment, but equal treatment.  122. Accordingly, any claim regarding a viola tion of the national treatment provisions of 
Article 3.1 TRIPS and 2.1 Paris Convention through the conditions for the re gistration of individual 
geographic indications would be unfounded. 
 
(c) The conditions for the registration of geogra phical indications do not depend on nationality 
123. As the EC has set out, Article 3.1 TRIPS and 2.1 Paris Convention require equal treatment, as 
regards the protection of intellectual property, between nationals
. However, the conditions and 
procedures contained in Regulation 2081/92 for th e registration of geographical indications do not 
depend on nationality. 
 124. As the EC has explained above, the cond itions and procedures for the registration of 
geographical indications relating to an area locate d in the EC are set out in Article 5 and 6 of 
Regulation 2081/92.
56 In contrast, the conditions and proce dures for the registration of geographical 
indications relating to an area located in another WTO Member are contained in Article 12a and 12b 
of the Regulation.57 
 
                                                      
53 Cf. above para. 68. 
54 Cf. e.g. US FWS, para. 57. 
55 Above para. 48 et seq., 50 et seq. 
56 See above para. 56 et seq. 
57 See above para. 62.  WT/DS174/R/Add.2 
 Page B-49 
 
 
 125. Whether the area to which a geographic indica tion is related is located inside the EC or 
outside is in no way linked to the question of the nationality of the producers of the product concerned. Protection of a geographical indication rela ting to an area located in the EC is obtained in 
accordance with Article 5 and 6 of the Regulation,  even if the producers in question are foreign 
nationals. Inversely, protection for a geographical i ndication located outside the EC must be obtained 
in accordance with Articles 12a and 12b of Regula tion 2081/92, even if the producers in question are 
EC nationals. In both situations, the same also applies if certain producers are EC nationals, and 
others are not.  126. Accordingly, Regulation 2081/92 does not di stinguish between EC nationals and other 
nationals. For this reason also, the claim must fail. 
 
3. Claim 2: Regulation 2081/92 violates the national treatment obligations under the 
TRIPS and the Paris Convention by requiring that applications must be transmitted by 
the country in which the ge ographical area is located 
127. The United States (but not Australia) has claimed that Regulation 2081/92 violates the 
national treatment obligations under the TRIPS and the Paris Convention by requiring that 
applications must be transmitted by the count ry in which the geographical area is located.
58 The 
United States has argued that this requirement implies an "extra hurdle" for foreign nationals which is 
not faced by EC nationals. In particular, the Un ited States has invoked the possibility that the third 
country concerned might have "neither the infrastru cture nor the inclination" to process and transmit 
the application. 
 128. The EC submits that this cl aim must fail. First, the question which government must transmit 
the application in accordance with Article 6 or Article 12a of the Regulation does not depend on 
nationality, but on the question where the geographic area in question is located.
59 Accordingly, 
Regulation 2081/92 does not differentiate on the basis of nationality. 
 129. Second, the Regulation does not constitute less favourable treatment for third country 
nationals. The role of third country government s provided for in Article 12a of the Regulation 
corresponds exactly to that of EC Member States where geographical indications relating to an area 
located in the EC are concerned. As the EC has set out above, this involvement of the Member State 
or third country concerned in the registration pro cess is crucial, as the government of the country 
concerned is particularly well placed to examin e the admissibility of applications relating to 
geographical areas located on its territory. Accordingly,  the condition that an application relating to an 
area located in a third country is transmitted by the government in question does not amount to "less 
favourable treatment", but in fact ensures equal treatment. 
 
130. The references by the US to an absence of "i nfrastructure" or "inclination" on the part of the 
third country are not convincing. The verification an d transmission of an application for registration 
of a geographical indication are not overly burdensome for another WTO Member. As regards "inclination", the EC finds it remarkable that the United States would invoke its own unwillingness to 
cooperate in the registration process in order to dem onstrate a national treatment violation on the part 
of the EC. 
 131. Accordingly, the claim that Regulation 2081/92 violates the national treatment obligations under the TRIPS and the Paris Convention by requiring that applications must be transmitted by the 
country in which the geographical area is located is unfounded. 
 
                                                     
 
58 US FWS, para. 81. 
59 Cf. above para. 123 et seq. WT/DS174/R/Add.2 
Page B-50  
 
 4. Claim 3: Non-EC nationals are accorded le ss favorable treatment than EC nationals 
with respect to the requirement to indicate  the country of origin for homonymous 
geographical indications  
132. The United States (but not Australia) has claimed that the requirement contained in 
Article 12(2) of Regulation 2081/92 to indicate the c ountry of origin constitutes a violation of national 
treatment provisions under the TRIPS and the Paris Convention.
60 This claim is unfounded for the 
following reasons:  
• Article 12(2) of Regulation 2081/92 does not  apply to all geographical indications, 
but only to homonyms; 
 
• the requirement to indicate the country of origin for homonymous geographical 
indications from the EC and third countries does not constitute less favourable treatment; 
 
• Article 12(2) of Regulation 2081/92 doe s not discriminate between nationals. 
 (a) Article 12(2) of Regulation 2081/ 92 does not apply to all geogra phical indications, but only to 
homonyms 
133. The United States has claimed that Article 12(2) of Regulation 2081/92 provides that use of 
all foreign geographical indications require the indi cation of the country of origin. As the EC has 
already clarified,
61 this claim of the United States is based on a misunderstanding. The second 
subparagraph of Article 12(2) only relates to the situ ation of the first subparagraph where "a protected 
name of a third country is identical to a Community protected name". Accordingly, there is no need to 
examine whether a requirement to indicate the country of origin for all foreign geographical indications would be compatible w ith national treatment obligations. 
 (b) The requirement to indicate the country of or igin for homonymous geographical indications 
from the EC and third countries does not constitute less favourable treatment 
134. Since it has misunderstood the meaning of Article 12(2) of the Regulation 2081/92, the 
United States has not indicated whether it considers the requirement to indicate the country of origin 
discriminatory also when only applying to hom onymous names from the EC and a third country. 
Should the United States have intended to make su ch an argument, then it would be manifestly 
unfounded. 
 
135. Article 12(2) in fact does not only apply to  third country names, but also to Community 
names. As the EC has explained, it therefore may require the indication of the country of origin for both EC and third country names, depending on wh ich geographical indication has been protected 
earlier.
62 Accordingly, Article 12(2) of Regulations tr eats geographical indications from the EC and 
third countries alike. 
 
136. Accordingly, Article 12(2) of Regulation 208 1/92 is entirely compatible with the national 
treatment obligations of the TRIPS and the Paris Convention. 
                                                      
60 US FWS, para. 68. Australia has made a similar claim under Article 2.1 of the TBT Agreement, 
which will be discussed below (cf. Australia's FWS, para. 234). 
61 Above para. 85. 
62 Above para. 88.  WT/DS174/R/Add.2 
 Page B-51 
 
 
 (c) Article 12(2) of Regulation 2081/92 doe s not discriminate between nationals 
137. The second subparagraph of Ar ticle 12(2) of Regulation 2081/92 provides that the use of 
"such names" is authorized only if the country of or igin is clearly and visibly indicated on the label. 
As the EC has set out above,63 "such names" is a reference to th e first subparagraph of Article 12(2). 
Accordingly, the requirement to indicate the country of origin applies where "a protected name of a 
third country is identical to a Community protected name". 
 138. As the EC has already set out in response to Claim 1, whether a protected name is a 
"Community name" or a "third country name" w ithin the meaning of Regulation 2081/92 depends on 
where the geographical area to which the geographical  indication is related is located. It has nothing 
to do with nationality. Accordingly, Article 12(2) does not imply any discrimination between 
nationals.
64 
 139. For all these reasons, the claim should be rejected.  5. Claim 4: Regulation 2081/92 accords less favou rable treatment to non-EC nationals by 
subjecting the right to object to the registrat ion of geographical indications to conditions 
of reciprocity and equivalence  
140. The United States and Australia have claimed that only nationals from WTO member 
countries recognised in accordance with Article 12(3) of Regulation 2081/92 as fulfilling the 
conditions of reciprocity and equivalence may object to registrations of geographical indications in 
accordance with Article 12d of the Regulation.
65 
 141. This is factually wrong. As the EC has already set out,
66 Article 12d(1) of Regulation 2081/92 
gives a right to object to any person that "is from a WTO Member or a third country recognised under the procedure provided for in Article 12(3)". It is  clear from this explicit reference to WTO Members 
that WTO Members are not subject to the procedur e of Article 12(3) applicable to other third 
countries. The same applies also under Article 12.b.2 with respect to objections against the 
registration of geographical indications from outside the EC.  142. The claim is also legally unfounded. Article 3.1 TRIPS and 2.1 of the Paris Convention relate 
only to equal treatment between nationals
. However, Article 7(3) of Regulation 2081/92 refers to 
persons which are resident or established in the EC, regardless of their nationality. Similarly, 
Article 12d(1) refers to persons resident or establis hed outside the EC, regardless of their nationality. 
It should also be noted that conditions regarding domicile or establishment are the subject of Article 2.2 Paris Convention, on the basis of wh ich the complainants have formulated separate 
claims.
67 
 
143. Accordingly, this claim should be dismissed. 
                                                      
63 Above para. 87. 
64 The EC would point out that if national treatment under the TRIPS were considered as applying also 
to discrimination between goods, then the relationship between the provisions of the TRIPS on national treatment and Article IX:1 of the GATT would become an issue (on the relationship between Article III:4 and 
IX:1 GATT, see below para. 213 et seq.). 
65 United States FWS, para. 92; Australia's FWS, para. 204. 
66 Above para. 73 et seq. 
67 See above Section II.B.3 and below Section IV.B. WT/DS174/R/Add.2 
Page B-52  
 
 6. Claim 5: Regulation 2081/92 accords less favou rable treatment to non-EC nationals by 
requiring their own country to transmit the objection  
144. The United States and Australia have cl aimed that Regulation 2081/92 accords less 
favourable treatment to non-EC nationals by requi ring their own country to transmit the objection.
68 
 
145. First, it must once again be remarked that Article 12d(2) applies not to nationals, but to 
persons resident or established in a third country . Accordingly, Regulation 2081/92 does not accord 
different treatment on the basis of nationality.  146. Second, the treatment accorded to persons resident or established in the Community and 
persons resident or established in the EC is exactly identical. For persons resident or established in the 
Community, Article 7 requires that the statement of  objection shall be submitted to the EC Member 
State where the person is resident or established, who shall transmit the objection to the Commission. For persons resident or established in a third count ry, Article 12d(1) provides that the statement shall 
be submitted to the third country of residence or establishment, which shall transmit it to the 
Commission. Accordingly, Regulation 2081/92 does not apply unequal, but equal treatment. 
 147. The United States has argued that the thir d country might not ha ve "the appropriate 
mechanism to process the objection, or may or may not  be inclined to transmit the objection, for its 
own political reasons".
69 Similarly, Australia has argued that third countries "have no legally defined 
relationship" regarding such objections.70 
 
148. These objections are unconvincing. First, it does not appear that a particularly demanding 
infrastructure is required for processing and transmitting a statement of objection. Second, the complainants cannot rely on their own unwillingness to  cooperate in the transmission of a statement 
of objection in order to demonstrate a violation of national treatment obligations on the part of the EC. 
 
149. Accordingly, Regulation 2081/92 does not accord less favourable treatment to non-EC nationals by requiring their own country to transmit the objection.  
7. Claim 6: Regulation 2081/92 accords less favou rable treatment to non-EC nationals by 
requiring non-EC national to have a "legitimat e interest" to object to the registration of 
geographical indications 
150. The United States (but not Australia) has claimed that Article 12d(1) Regulation 2081/92 
accords less favourable treatment to non-EC nationa ls by requiring non-EC  nationals to have a 
"legitimate interest" to object to the registration of geographical indications.
71 
 
151. As the EC has shown, there is no substantive difference between the term  "legitimate interest" 
used in Article 12d(1) of Regulation 2081/92 and th e term "legitimately concerned" in Article 7(3). 
Rather, "legitimately concerned" and "legitimately concerned" are synonymous expressions.  152. Since the claim is based on a misunderstandi ng of the Regulation, it does not need to be 
discussed any further. 
 
                                                     
 
68 US, FWS, para. 90; Australia's FWS, para. 205. 
69 US, FWS, para. 90. 
70 Australia's FWS, para. 205. 
71 US, FWS, para. 93-94.  WT/DS174/R/Add.2 
 Page B-53 
 
 
 8. Claim 7: Regulation 2081/92 accords less  favourable treatment because a non-EC 
rightholder has no "representative" in the regulatory committee to "speak for him" 
153. Australia (but not the United States) has argued that Regulation 2081/92 accords less 
favourable treatment because a non-EC rightholder has no "representative" in the regulatory committee to "speak for him".
72 
 
154. This claim is manifestly unfounded. First, Au stralia has not correctly understood the decision-
making process under the Regulation. As the EC has set out,73 the decision-maker under the 
Regulation is the Commission, or exceptionally the Council. The Committee merely assists the 
Commission, and may exceptionally achieve that a propo sal is referred to the Council. In no case does 
it take decisions itself. Moreover, Member Stat es representatives on the Committee do not speak for 
particular rightholders, but represent the respective EC Member State.  155. Secondly, Australia's claim to have a re presentative on the regulatory committee is not 
reasonable. The public authorities of a WTO Member must be presumed to administer their duties 
properly and fairly. This is inde pendent of the nationality of the civil servants and employees working 
for such authorities. The EC also notes that ther e are no "EC representatives" in the public authorities 
and agencies of Australia. The EC does not assume that  Australia would want to suggest that for this 
reason, Australian authorities cannot be assumed to correctly implement their WTO obligations with respect to the EC.  9. Claim 8: A right of objection was available to persons resident or established in an EC 
Member State that was not available to oth er WTO Member nationals in respect of the 
registration of more than 120 geographical indications under the normal registration 
process 
156. Australia has claimed that there is a violation of national treatment in the fact that a right of 
objection was available to persons resident or est ablished in an EC Member State that was not 
available to other WTO Member nationals in respect of the registration of mo re than 120 geographical 
indications under the normal registration process.
74 This claim must fail for the following reasons: 
 
• Australia's claim relates to a measure which was no longer in force at the time of 
establishment of the Panel, and which is ther efore not within the terms of reference of 
the Panel; 
 
• the individual registrations are not in vi olation of national treatment obligations; 
 
• Australia is seeking to obtain a retroactiv e remedy it could not have obtained had it 
attacked the measure while it was still in force. 
 (a) Australia's claim relates to a measure whic h was no longer in force at the time of 
establishment of the Panel, and which is theref ore not within the term s of reference of the 
Panel 
157. Australia's claim relates to Regulation 2081/92 as in force until 8 April 2003, when 
Regulation 692/2003 entered into force. It therefor e relates to a measure which was no longer in force 
                                                     
 
72 Australia's FWS, para. 203. 
73 Above, para. 79 et seq. 
74 Australia's FWS, para. 184 et seq. WT/DS174/R/Add.2 
Page B-54  
 
 at the time of establishment of the Panel. Accordi ngly, as the EC has set out above, this measure is 
therefore not within the terms of reference of the Panel.
75 
 (b) The individual registrations are not in vi olation of national treatment obligations 
158. In its submission, Australia has also argued that "in respect to the registration under the 
normal registration process of more than 120 EC-defined GIs" before Regulation 2081/92 was 
amended by Regulation 692/2003, the "EC measure " accorded less favourable treatment to foreign 
nationals. With this claim, Australia seems to sugg est that the individual registrations of geographical 
indications which were carried out prior to th e entry into force of Regulation 692/2003 somehow 
violate the national treatment obligations under the TRIPS and the Paris Convention. 
 
159. This claim of Australia's is unfounded. Au stralia has made no plausible case that the 120 
registrations in question in any way violate the na tional treatment obligations under the TRIPS and the 
Paris Convention.  
160. Australia's claim is based exclusively on the argument that no right of objection was available 
to third country-nationals under Regulation 2081/92 before its amendment by  Regulation 692/2003. 
However, this claim relates to Regulation 2081/92  as applicable before its amendment, and the 
procedure it prescribed for the registration of geographical indications. The rules governing the 
procedure leading up to the adoption of a measure are not the same as the measure itself.  
161. In contrast, Australia has advanced no argumen ts in support of its claim that the individual 
registrations are incompatible with national treatme nt obligations. It is submitted that Australia is 
unable to do so. Each individual registration grants  protection to a specific geographical indication 
relating to a specific geographical area. It is not  clear to the European Community how such a 
registration could be considered to grant less favourable treatment to third-country nationals. 
 
(c) Australia is seeking to obtain a retroactive re medy it could not have obtained had it attacked 
the measure while it was still in force. 
162. In addition, the EC considers it important to re mark that Australia's clai m, if directed against 
the individual registrations, has considerable impli cations for the dispute settlement system set up by 
the DSU. In fact, with its claim, Australia is seek ing to obtain a retroactive remedy that it could not 
even have obtained had it attacked Regul ation 2081/92 before it was amended by 
Regulation 692/2003.  163. According to Article 19.1 DSU, where a pa nel or the Appellate Body concludes that a 
measure is inconsistent with a covered agreement, it shall recommend that the Member concerned 
"bring the measure into conformity with that agreemen t". It is universally accepted that this signifies 
that recommendations of panels and the Appellate Bo dy are prospective, not retrospective in nature.
76 
This has also been confirmed by the Appellate Body in US – Certain EC Products :77 
 
We note, though, that there is an obvious inconsistency between the finding of the Panel that "the 3 March Measure is no l onger in existence" and the subsequent 
recommendation of the Panel that the DSB re quest that the United States bring its 3 
March Measure into conformity with its  WTO obligations.  The Panel erred in 
                                                     
 
75 See above Section II.A.1. 
76 Australia itself has argued in favour of the prospec tive character of WTO remedi es even in regard to 
Article 4.7 SCM Agreement; cf. Panel Report, Australia – Automotive Leather (Article 21.5 – US) , para. 6.14. 
77 Appellate Body, US – Certain EC Products , para. 81.  WT/DS174/R/Add.2 
 Page B-55 
 
 
 recommending that the DSB request the United States to bring into conformity with 
its WTO obligations a measure which the Panel has found no longer exists. 
164. Reference can also be made to the findings of the GATT Panel in Norway – Trondheim 
Bridge , which clearly stated that GATT remedies were not retroactive:78 
 
The Panel then turned its attention to th e recommendations that the United States had 
requested it to make. In regard to the Un ited States' request that the Panel recommend 
that Norway take the necessary measures to bring its practices into compliance with the Agreement with regard to the Trondheim procurement, the Panel noted that all the 
acts of non-compliance alleged by the United States were acts that had taken place in 
the past. The only way mentioned during the Panel's proceedings that Norway could 
bring the Trondheim procurement into line with its obligations under the Agreement 
would be by annulling the contract and recommencing the procurement process. The 
Panel did not consider it appropriate  to make such a recommendation. 
Recommendations of this nature had not b een within customary practice in dispute 
settlement under the GATT system and the dr afters of the Agreement on Government 
Procurement had not made specific provision that such recommendations be within the task assigned to panels under standard terms of reference. Moreover, the Panel 
considered that in the case under examination such a recommendation might be disproportionate, involving waste of resour ces and possible damage to the interests of 
third parties.
 
165. The Panel went on to emphasise that these considerations were in no way specific to 
government procurement, but were of a general nature:79 
 
In considering this argument, the Panel was of the view that situations of the type 
described by the United States were not unique to government procurement. 
Considerable trade damage could be caused in other areas by an administrative 
decision without there necessarily being an y GATT inconsistent legislation, for 
example in the areas of discretionary licensing, technical regulations, sanitary and phytosanitary measures and subsidies. Moreover, there had been cases where a 
temporary measure contested before the GATT had been lifted before a Panel had 
been able to report.
 
166. In the present case, even if Australia had ch allenged a violation of national treatment before 
Regulation 2081/92 was amended by Regulation 692/2003, it could therefore not have claimed that 
the EC undo all the registrations already carried out, or that it reopen a possibility of objection against such registrations.  
167. Australia has also argued that when Regula tion 692/2003 entered into force, it should have 
reopened a full objection period in r espect to all geographical indicati ons for which applications were 
pending.
80 This argument shows even more clearly the re troactive character of Australia's claims. If 
the period of objection had already fully or partially run out for EC residents, then claims based on 
national treatment would not have given a retroactive right to reopen an objection period for non-EC 
residents. 
 
                                                      
78 Panel Report, Norway – Trondheim Bridge , para. 4.17. 
79 Panel Report, Norway – Trondheim Bridge , para. 4.23. 
80 Australia's FWS, para. 188. WT/DS174/R/Add.2 
Page B-56  
 
 168. By formulating its claim not against the terminated measure but against the acts which are 
derived from it, Australia is effectively trying to circumvent the principle that WTO remedies are not 
retroactive in nature. For this reason also, Australia's claim must be rejected.  169. For all the reasons set out above, Australia's claim must be rejected. 
 
10. Claim 9: A right of objection was available to persons resident or established in an EC 
Member State that was not available to oth er WTO Member nationals in respect of the 
registration of more than 480 EC-defined G Is under the simplified registration process 
170. Finally, Australia also claims that a right of objection was available to persons resident or 
established in an EC Member State that was not av ailable to other WTO Member nationals in respect 
of the registration of more than 480 EC-defined  GIs under the simplified registration procedure.
81 In 
this respect, Australia refers to the simplified re gistration procedure provided for in Article 17 of 
Regulation 2082/92 until its amendm ent through Regulation 2081/92. 
 
171. With this claim, Australia is once again tryi ng to obtain a retrospective remedy for a measure 
which is not within the terms of reference of the Pa nel, and which it did no challenge while it was still 
in force. All arguments that have been set out in respect of the Claim 8 therefore apply here as well. 
 172. Moreover, Australia's claim is factually wr ong. As the EC has already set out, there was no 
right of objection for EC residents under the simplified procedure.
82 The fact that there was no right of 
objection for third-country residents therefore did not constitute a violation of national treatment 
obligations.  173. Australia's claims must therefore be rejected.  
B. P
ROHIBITED REQUIREMENT OF DOMICILE OR ESTABLISHMENT (ARTICLE  2.1 TRIPS  IN 
CONJUNCTION WITH ARTICLE  2.2 PARIS CONVENTION ) 
174. The complainants have also raised certain claims under Article 2.1 TR IPS in conjunction with 
Article 2.2 Paris Convention. Article 2.2 Paris C onvention, which prohibits subjecting the enjoyment 
of intellectual property rights to a condition of dom icile or establishment, is a separate and distinct 
obligation from Article 2.1 of the Paris Convention. 
 
175. As the EC has set out, the complainant's claims under Article 2.2 Paris Convention are not within the Panel's terms of reference.
83 This notwithstanding, the EC will hereafter briefly refute 
certain erroneous arguments made in this respect by the complainants.  1. Claim 10: Regulation 2081/92 requires non-EC nationals to become established in the 
EC as a condition for registering geographical indications  
176. The United States (but not Australia) has argued that Regulation 2081/92 requires non-EC 
nationals to become established in the EC as a condition for registering geographical indications.
84 
This claim is unfounded for the following reasons:  
• Geographical indications relating to an area located in a WTO country can be 
registered under Regulation 2081/92; 
                                                     
 
81 Australia's FWS, para. 190 et seq.  
82 Supra para. 91 et seq. 
83 See above Section II.B.3. 
84 US FWS, para. 84.  WT/DS174/R/Add.2 
 Page B-57 
 
 
  
• The right to register a geographical indication does not depend on domicile or 
establishment; 
 
• Article 2.2 Paris Convention does not exclude measures which ensure that a product 
originates in the geographical to which a protected geographical indication area is 
related. 
 (a) Geographical indications relating to an area lo cated in a WTO country can be registered under 
Regulation 2081/92 
177. The United States has based its claim on the assumption that a US national cannot register a 
geographical indication relating to an area in the United States.
85 The United States claim therefore 
seems to be based on its assumption that the regist ration of geographical indications relating to an 
area outside the EC is possible only if conditions of  reciprocity and equivalence of protection systems 
are fulfilled.  178. As the EC has already explained, the registration of geographical indications relating to an 
area located in anther WTO Member does not depend on the fulfilment of such conditions.
86 Any 
geographical indication relating to an area in anothe r WTO Member can be registered if it fulfils the 
conditions set out in the Regulation.  179. Accordingly, there is no requirement as to domicile or establishment for the registration of geographical indications relating to an area located in a third country. Already for this reason, the 
United States claim must fail. 
 (b) The right to register a geographical indication does not depend on domicile or establishment 
180. The United States has argued further that a US national could not register a geographical 
indication relating to an area located in the EC w ithout "having some form of investment or business 
establishment in the EC".
87 
 181. This assumption of the United States is wrong. First of all, not any form of investment or "business establishment" would appear to constitu te "an establishment" within the meaning of 
Article 2.2 of the Paris Convention. 
 
182. Second, in order for a name to qualify as a geographical indication under Regulation 2081/92, 
it must "possess a specific quality, reputation or othe r characteristics attributable to that geographical 
origin and the production and/or processing and/or preparation of which take place in the defined 
geographical area ".88 
 
183. Accordingly, the Regulation does not require that a producer be domiciled or established in 
the EC. It merely requires that the production,  processing or preparation, alternatively or 
cumulatively, must take place in the defined geographical area. What specific activities of production, processing, or preparation must take place in the sp ecific area will depend on the specifications for the 
                                                     
 
85 US FWS, para. 85. 
86 Above para. 62 et seq. 
87 US FWS, para. 85. 
88 Article 2.2 (b) of the Regulation. As has been noted above para. 46, a closer link with the 
geographical area is required for designations of origin. However, since the procedures for registration and protection of designations of origin are identical to thos e for geographical indications, the EC will refer only to 
the latter. WT/DS174/R/Add.2 
Page B-58  
 
 product in question. It cannot be assumed, however, that these specifications will necessarily require a 
producer to be domiciled or established in the geographical area in question.  (c) Article 2.2 Paris Convention does not exclude  measures which ensure that a product 
originates in the geographical area to which a protected geographical indication is related 
184. Moreover, if the argument of the United States were accepted, it would have the effect of 
rendering the protection of geographical indica tions as defined in the TRIPS impossible. 
 185. According to Article 22.1 TRIPS, a geogra phical indication identifies "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 ". Thus, the 
definition of a geographical indication in the TRIPS presupposes that the good in question has an identifiable geographical origin
. 
 186. The definition in Regulation 2081/92 that the production and/or  processing and/or preparation 
must take place in the defined geographical area im plements this requirement of an identifiable 
geographical origin. The argument of the United States that this constitutes a requirement of 
"domicile or establishment" incompatible with Artic le 2.2 of the Paris Convention is equivalent to 
saying that a geographical indication should be protected even if the products in question do not originate in the area to which the geographical indication relates.  
187. Such an interpretation is incompatible with Article 22.1 TRIPS, and must also for this reason 
be rejected.  
2. Claim 11: Regulation 2081/92 requires non-EC nationals to become established in the 
EC as a condition for objecting  
188. The United States has argued that the fact that Regulation 2081/92 requires the home country 
of third country nationals to transmit the statemen t of objection constitutes a requirement of residence 
or domicile contrary to Article 2.2 of the Paris Convention.
89 
 189. This claim is manifestly unfounded. Ar ticle 12d(1) of Regulation 2081/92 explicitly allows
 
persons from other WTO countries who are resident or established in third countries to object to 
registrations. It merely requires that, in close para llelism with the situation for EC residents, the 
statement of objection be transmitted by the third country in which the person is resident. This 
procedural modality does not constitute a "requirement of domicile or establishment" for the enjoyment of an industrial property right. Accordingly, this claim must be rejected.  
C. N
ATIONAL TREATMENT UNDER ARTICLE  III:4  GATT 
190. The complainants have raised a number of  claims alleging that Regulation 2081/92 is 
incompatible with the national treatment obligation contained in Article III:4 GATT. In this section, 
the EC will show that Regulation 2081/92 is fu lly compatible with Article III:4 GATT. In the 
alternative, the EC considers that the EC measure is justified by Article XX (d) GATT. 
                                                      
89 US FWS, para. 91. Australia has raised Article 2.2 Paris Convention in the context of its claims with 
respect to Regulation 2081/92 as applicable before it was amended by Regulation 692/2003 (Australia's FWS, 
paras. 189, 194). Like the claims raised under Article 3.1 TRIPS and 2.1 Paris Convention, these claims are outside the terms of reference of the Panel, and therefore need not be considered further (cf. above 
Section II.A.1).  WT/DS174/R/Add.2 
 Page B-59 
 
 
 1. The regulation 2081/92 is not incompatible with Article III:4 GATT 
191. The national treatment obligation contai ned in Article III:4 GATT provides as follows: 
 
The products of the territory of any contracting party imported into the territory of any other contracting party shall be accord ed treatment no less favourable than that 
accorded to like products of national origin  in respect of all laws, regulations and 
requirements affecting their internal sale, offering for sale, purchase, transportation, 
distribution or use.  The provisions of this  paragraph shall not prevent the application 
of differential internal transportation ch arges which are based exclusively on the 
economic operation of the means of tran sport and not on the nationality of the 
product. 
192. As the EC will show, Regulation 2081/92 is  entirely compatible with this obligation. 
 (a) General remarks 
193. In Korea – Various Measures on Beef , the Appellate Body explained that for a violation of 
Article III:4 to be established, three elements must be satisfied:
90 
 
For a violation of Article III:4 to be established, three elements must be satisfied:  that the imported and domestic products at is sue are "like products";  that the measure 
at issue is a "law, regulation, or requiremen t affecting their internal sale, offering for 
sale, purchase, transportation, distribution, or use";  and that the imported products 
are accorded "less favourable" treatment than that accorded to like domestic products.  
194. The EC does not contest that Regulation 2081/92 is a measure affecting the internal sale of 
products. However, it considers that some genera l remarks are necessary on the first and the third 
condition, namely that products at issue must be "like products", and that the imported products must 
be accorded "less favourable treatment" than like domestic products. 
 
(i) Like products 
195. The EC does not contest that products from third countries falling under the scope of 
Regulation 2081/92 may be "like" EC products wh ich fall under the scope of that Regulation.  
 196. The EC would also like to stress, however, that  the question of whether products are "like" for 
the purposes of Article III:4 GATT must be separated from the question of whether the conditions for 
the registration of individual geographic indications  are fulfilled. In the following passage in its first 
written submission, Australia seems to be merging these two issues:
91 
 
However, the products in respect of whic h an EC-defined GI may be registered 
remain subject to the provisions of Ar ticle III:4 of GATT 1994.  Thus, within the 
meaning of GATT Article III:4, for example:  imported apples and pears would be like products to "Savoie" apples and pears;   imported oysters would be like products 
to "Whitstable" oysters;  imported olive oils would be like product to the many olive oils for which an EC-defined GI has been  registered;  and im ported trout would be 
like product with "Black Forest" trout. 
                                                     
 
90 Appellate Body Report, Korea – Various Measures on Beef, para. 133. 
91 Australia's FWS, para. 162. WT/DS174/R/Add.2 
Page B-60  
 
 197. Once again, the EC has no problem in accepting that apples or oysters from Australia may be 
"like" apples or oysters from the EC. However, the EC  would like to remark that this does not mean 
that the EC cannot apply the conditions for the regi stration of geographic indications, as long as these 
conditions do not result in less favourab le treatment for imported products.  
 
198. The fact that a domestic measure may disti nguish between "like" products without for that 
reason alone according less favorable treatment, was al so explicitly confirmed by the Appellate Body 
in EC – Asbestos :
92 
 
We recognize that, by interpreting the term " like products" in Article III:4 in this way, 
we give that provision a relatively broa d product scope – although no broader than 
the product scope of Article III:2.  In so doing, we observe that there is a second 
element that must be established before a measu re can be held to be inconsistent with 
Article III:4.  Thus, even if two products ar e "like", that does not mean that a measure 
is inconsistent with Article III:4.  A complaining Member must still establish that the 
measure accords to the group of "like"  imported  products "less favourable 
treatment" than it accords to the group of "like"  domestic  products.  The term "less 
favourable treatment" expresses the general prin ciple, in Article III:1, that internal 
regulations "should not be applied … so as to afford protection to domestic 
production".  If there is "less favourable treat ment" of the group of "like" imported 
products, there is, conversely, "protection" of the group of "like" domestic products.  
However, a Member may draw distinctions  between products which have been found 
to be "like", without, for this reason alone, according to the group of "like"  imported   
products "less favourable treatment" than that accorded to the group of "like"  domestic   products.  [...]. 
(ii) Less favourable treatment 
199. In Korea – Various Measures on Beef , the Appellate Body has defined the meaning of "less 
favourable treatment" as follows:
93 
 
We observe, however, that Article III:4 requi res only that a measure accord treatment 
to imported products that is "no less favour able" than that accorded to like domestic 
products.  A measure that provides treat ment to imported products that is  different   
from that accorded to like domestic products  is not necessarily inconsistent with 
Article III:4, as long as the treatment provided by the measure is "no less favourable".  According "treatment no less favourable" means, as we have previously said, according conditions of competition  no less favourable to the imported product than 
to the like domestic product. 
200. The Appellate Body continued as follows:
94 
 
A formal difference in treatment between imported and like domestic products is thus 
neither necessary, nor sufficient, to show a violation of Article III:4. Whether or not 
imported products are treated "less favourably " than like domestic products should be 
assessed instead by examining whether a measure modifies the conditions of 
competition   in the relevant market to the detriment of imported products. 
                                                      
92 Appellate Body Report, EC – Asbestos , para. 100. 
93 Appellate Body Report, Korea – Various Measures on Beef, para. 135. 
94 Appellate Body Report, Korea – Various Measures on Beef, para. 137.  WT/DS174/R/Add.2 
 Page B-61 
 
 
 201. As the EC will show, Regulation 2081/92 does not modify the conditions of competition to 
the detriment of imported products.  (b) Claim 12: Regulation 2081/92 accords less favourab le treatment as regards the conditions for 
registration of foreign geographical indications 
202. The complainants have claimed that Regul ation 2081/92 accords less favourable treatment as 
regards the conditions for registration of foreign geographical indications by imposing conditions of 
reciprocity and equivalence.
95 
 203. As the EC has already stated above, Re gulation 2081/92 does not impose a condition of 
reciprocity and systemic equivalence for the regi stration of geographical indications from other WTO 
Members.
96 Accordingly, it does not apply less favourable treatment to products from other WTO 
Members.  204. As it has already done in response to the clai ms under the national treatment provisions of the 
TRIPS and the Paris Convention,
97 the EC would like to recall, however, that whereas it does not 
require other WTO Members to have an equivale nt system for the protection of geographical 
indications, it must ensure that indications from th ird countries comply with the conditions set out in 
Regulation 2081/92. However, in this respect, the EC treats products from the EC like it treats products from other WTO Members.  
205. The claim that Regulation 2081/92 accords less favourable treatments as regards the 
conditions for registration of foreign geographical indications by imposing conditions of reciprocity 
and equivalence must therefore be dismissed.  (c) Claim 13: Regulation 2081/92 accords less favour able treatment as regards the requirement 
that the application must be transmitted by the government of the third country 
206. The complainants have argued that Regula tion 2081/92 accords less favourable treatment as 
regards the requirement that the application must  be transmitted by the government of the third 
country.
98 
 207. As the EC has already set out above with r espect to the national treatment obligations under 
the TRIPS and the Paris Convention,
99 the role of third country governments provided for in 
Article 12a of the Regulation corresponds exactly to that of EC Member States where geographical 
indications relating to an area located in the EC are concerned. Accordingly, the condition that an 
application relating to an area located in a third c ountry is transmitted by the government in question 
does not amount to "less favourable treatment", but in fact ensures equal treatment. Moreover, 
Australia and the United States cannot invoke their own unwillingness to cooperate in the application 
process in order to argue that Regulation 2081/92 constitutes less favourable treatment for their own 
nationals.  208. Accordingly, this claim is equally unfounded.  
                                                     
 
95 US FWS, para. 104; Australia's FWS, para. 165 et seq. 
96 See above, para. 62. 
97 Above para. 113 et seq.  
98 US FWS, para. 104(d); Australia's FWS, para. 172 et seq. 
99 Above para. 127 et seq. WT/DS174/R/Add.2 
Page B-62  
 
 (d) Claim 14: Regulation 2081/92 accords less favourab le treatment as regards the requirement to 
indicate the country of origin 
209. The United States (but not Australia) has argued that Regulation 2081/92 accords less 
favourable treatments as regards the require ment to indicate the country of origin.
100 
 
210. This claim is unfounded for the following reasons:  
 
• Article 12(2) of Regulation 2081/92 does not  apply to all geographical indications, 
but only to homonyms;  
 
• The requirement to indicate the country of origin for homonymous geographical 
indications from the EC and third countries does not constitute less favourable 
treatment; 
 
• Article IX:1 of the GATT is a lex specialis to Article III:4 GATT; national treatment 
obligations therefore do not apply to requir ements to mark the country of origin. 
 
(i) Article 12(2) of Regulation 2081/92 does not ap ply to all geographical indications, but only 
to homonyms 
211. As the EC has already set out in response to the United States' corresponding claim under the 
TRIPS Agreement, Article 12(2) of  Regulation 2081/92 does not apply to all geographical indications, 
but only to homonyms.101 Accordingly, there is no requirement to indicate the country of origin for all 
foreign geographical indications. 
 
(ii) The requirement to indicate the country of origin for homonymous geographical indications 
from the EC and third countries does not constitute less favourable treatment 
212. As the EC has also already explained, Artic le 12(2) does not only apply to third country 
names, but applies on equal terms to Community names.102 Accordingly, Article 12(2) treats foreign 
and EC goods alike. 
 
(iii) Article IX:1 of the GATT is a lex specialis  to Article III:4 GATT; national treatment 
obligations therefore do not apply to requirements to mark the country of origin 
213. Finally, it should be noted that marks of origin are dealt with in Article IX of the GATT. 
Article IX:1 provides as follows: 
 
Each contracting party shall accord to th e products of the territories of other 
contracting parties treatment with regard  to marking requirements no less favourable 
than the treatment accorded to like products of any third country. 
214. It is noteworthy that Article IX GATT contains, with respect to marks of origin, exclusively 
an obligation to provide most-favoured nation treatme nt. It does not contain an obligation to also 
provide national treatment. This has b een confirmed by the GATT Panel in US – Tuna :103 
 
                                                      
100 US FWS, para. 106. Australia has made a similar claim under Article 2.1 of the TBT Agreement, 
which will be discussed below (cf. Australia's FWS, para. 234). 
101 Above para. 133. 
102 Above para. 134. 
103 Panel Report, US – Import Restrictions on Tuna , para. 5.41.  WT/DS174/R/Add.2 
 Page B-63 
 
 
 The Panel noted that the title of Article IX is  'Marks of Origin' and its text refers to 
marking of origin of imported products. The Panel further noted that Article IX does 
not contain a national-treatment but only a most-favoured-nation requirement, which 
indicates that this provision was intended to regulate marking of origin of imported products but not marking of products gene rally. The Panel therefore found that the 
labelling provisions of the DPCIA did not fall under Article IX:1. 
215. This omission in Article IX:1 cannot be re garded as accidental. If the GATT had meant to 
also impose a national treatment obligation with respect  to marks of origin, it would have been natural 
to include such an obligation in Article IX. Alterna tively, Article IX could have remained silent on the 
issue of national and most-favoured nation treatment , in which case the general obligations contained 
in Articles I and III of the GATT would have applied. 
 216. By laying down an obligation only to provide most-favoured nation treatment and not also national treatment, Article IX implies that WTO members are free to impose country of origin marking only with respect to imported products a nd not to domestic products . This understanding is 
also confirmed by a report of a GATT working party:
104 
 
The Working Party considered that the qu estion of additional marking requirements, 
such as an obligation to add the name of the producer or the place of origin or the 
formula of the product, should not be brought within the scope of any recommendation dealing with the problem of marks of origin. The point was stressed 
that requirements going beyond the obligation to indicate origin would not be 
consistent with the requirements of Article III, if the same requirements did not apply 
to domestic producers of like products . 
217. For these reasons, Article III:4 is not applicab le to requirements to indicate the country of 
origin for an imported product. 
 
218. For all the reasons set out, the EC submits that the United States claim must be rejected.  (e) Claim 15: Regulation 2081/92 accords less favourable treatment due to an overall bias in the 
decision-making process 
219. Australia has argued that Regulation 2081/92 acco rds less favourable treatment in that there is 
an overall bias in the decision-making process due to the alleged fact:
105 
 
that the outcome of the application is to be  determined through a process, that is, the 
Committee of EC Member State representatives, in which: 
• there is no representative or advocate for the registration of 
an EC-defined GI for an imported product;  and  
• there is no requirement for procedural fairness, due process 
and/or transparency concerning that Committee's decision-
making process.  
220. First of all, this claim is based on a mi sunderstanding of the decision-making process under 
the Regulation. As the EC has already explaine d, the decision-maker under the Regulation is the 
                                                      
104 L/595, adopted on 17 November 1956, 5S/102, 105-106, para. 13 (emphasis added). 
105 Australia's FWS, para. 177. WT/DS174/R/Add.2 
Page B-64  
 
 Commission, or exceptionally the Council.
106 The Committee merely assists the Commission, and 
may exceptionally achieve that a propos al is referred to the Council.  
 221. Secondly, as the EC has already argued, Aust ralia's claim to a have representative on the 
regulatory committee is manifestly unfounded.
107 
 
222. Finally, the Australian statement that there is "no requirement for procedural fairness, due 
process and/or transparency" concerning the decision -making process of the Committee is completely 
unsupported by fact.  
223. For these reasons, the Australian claim must be rejected. 
 
2. The measure would be justified under Article XX (d) GATT 
224. As explained, it is unclear to the EC whet her the complainants clai m that the requirements 
imposed by Article 12a, in conjunction with Article s 4 and 10, of Regulation 2081/92 with respect to 
the registration of each specific geographical indicati on are as such incompatible with Article III:4 of 
the GATT. The EC has shown that those requirements do not provide less favourable treatment to imported like products and, therefore, ar e consistent with that provision. 
 225. In the event that the complainants were to cl aim that such requirement s are inconsistent with 
Article III:4 of the GATT, and should the Panel find that they afford less favourable treatment to 
imported products, the EC submits in the alternative that such requirements would be justified under 
Article XX(d) of the GATT.  226. More specifically, the EC subm its that the requirements at is sue are necessary in order to 
ensure that only those products which conform to the definition of geographical indications contained 
in Article 2(2) of Regulation 2081/92, which is itsel f fully consistent with the GATT, benefit from the 
protection afforded to geographical indications by Regulation 2081/92. 
 
V. REGULATION 2081/92 IS COMPATIBLE WI TH THE OBLIGATION TO PROVIDE 
MOST-FAVOURED-NATION TREATMENT 
227. The United States (but not Australia)
108 has claimed that Regulation 2081/92 is incompatible 
with the obligation to provide most-favoured-natio n treatment under Article 4 TRIPS and Article I:1 
GATT. The EC will discuss the United States claims under both provisions separately.  A. A
RTICLE  4 TRIPS 
228. The United States has made two claims under the most-favoured-nation provision of Article 4 
TRIPS: 
 
• As among non-EC WTO Members, nationals from WTO Members that satisfy the 
EC's conditions of reciprocity and equi valency are accorded more favourable 
treatment than nationals from those WTO Members that do not; 
 
                                                      
106 Above, para. 79. 
107 Above, para. 155. 
108 Australia has not made any claim in this respect, bu t has reserved the "right to pursue such a claim" 
in the event that the EC "is applying" or "begins to  apply Community-wide protection to EC-defined GIs for 
foodstuffs and agricultural products from another WTO Member" (Australia's FWS, para. 65).  WT/DS174/R/Add.2 
 Page B-65 
 
 
 • under Regulation 2081/92, an EC Member Stat e grants more favourable treatment to 
nationals from other EC Member States th an it accords to nationals from non-EC 
WTO Members. 
 
1. Claim 16: As among non-EC WTO Member s, nationals from WTO Members that 
satisfy the EC's conditions of reciprocity a nd equivalency are accorded more favourable 
treatment than nationals from those WTO Members that do not  
229. The United States has claimed that nationa ls from WTO Members that satisfy the EC's 
conditions of reciprocity and equivalency are accord ed more favourable treatment than nationals from 
those WTO Members that do not.109 
 
230. This claim is unfounded for the following reasons: 
 
• the EC does not apply a condition of reciprocity and equivalence for the registration 
of geographical indications from other WTO members;  
 
• the conditions for the registration of indi vidual geographical indications from third 
countries are not discriminatory; 
 
• Article 12 of Regulation 2081/92 does not gr ant any advantage, favour, privilege or 
immunity to any other country; 
 
• the conditions for the registration of geographical indications do not depend on 
nationality. 
 
(a) The EC does not apply a condition of reciproc ity and equivalence for the registration of 
geographical indications from other WTO members 
231. Article 4 TRIPS requires that "with regard to the protection of intellectual property, any 
advantage, favour, privilege or imm unity granted by a Member to the nationals of any other country 
shall be accorded immediately and unconditionall y to the nationals of all other Members". 
 
232. As the EC has already explained, it does not apply a condition of reci procity and equivalence 
to the registration of geographical indications from other WTO Members.110 Accordingly, 
geographical indications relating to an area located in another WTO country can be registered under 
Regulation 2081/92 in accordance with Artic le 12a and 12b of Regulation 2081/92.  
 
233. In contrast, the conditions of Article 12(1) and 12(3) are applicable for the registration of 
geographical indications from third countries wh ich are not WTO Members. Moreover, it should be 
recalled that Article 4 TRIPS does not require that benefits are extended to third countries which are 
not WTO Members . 
 
234. Accordingly, Regulation 2081/92 does not tr eat nationals of other WTO Members less 
favourable than those of other third countries.  
                                                     
 
109 US FWS, para. 119. 
110 Above para. 62 et seq. WT/DS174/R/Add.2 
Page B-66  
 
 (b) The conditions for the registration of individua l geographical indications from third countries 
are not discriminatory 
235. As in respect of the claims regarding nationa l treatment, the EC is not sure whether the United 
States also challenges the product-specific conditions for the registration of geographical indications 
from third countries.  
 
236. However, if it does, such a claim would have  to be regarded as unfounded. The conditions for 
the registration of individual geographical indicati ons, and in particular th e requirement of a product 
specification and the existence of inspection structur es, do not discriminate on the basis of nationality 
or product origin. Moreover, they are examined for each product individually. 
 
237. In this context, it is usef ul to recall the Panel report in Canada – Autos , which stated that 
most-favoured nation treatment does not exclude subj ecting advantages to conditions, as long as these 
conditions are non-discriminatory:
111 
 
In this respect, it appears to us that ther e is an important distinction to be made 
between, on the one hand, the issue of whet her an advantage within the meaning of 
Article I:1 is subject to c onditions, and on the other, whether an advantage, once it 
has been granted to the product of any count ry, is accorded "unconditionally" to the 
like product of other Members. An advantage can be granted subject to conditions without necessarily implying that it is not accorded "unconditionally" to the like 
product of other Members. More  specifically, the fact that conditions attached to such 
an advantage are not related to the imported product itself does not necessarily imply that such conditions are discriminatory with respect to the origin of imported products. We therefore do not believe that, as argued by Japan, the word "unconditionally" in Article I:1 must be inte rpreted to mean that making an advantage 
conditional on criteria not related to the imported product itself is per se  inconsistent 
with Article I:1, irrespective of whether and how such criteria relate to the origin of 
the imported products. 
238. Accordingly, the application of the conditions  for the registration of individual geographical 
indications from other WTO Members is not inco mpatible with most-favoured-nation principles. 
 
(c) Article 12 of Regulation 2081/92 does not grant any advantage, favour, privilege or immunity 
to any other country 
239. Second, Article 12 of Regulation 2081/92 does not involve the granting of any advantage to a 
third country.
112 
 
240. Article 12(1) of Regulation 2081/92 provides the conditions under which the Regulation may 
apply to a third country which is not a WTO Me mber. In accordance with Article 12(3) of the 
Regulation, the Commission must examine whether th e conditions in Article 12(1) are fulfilled. The 
conditions set out in Article 12(1) are the same fo r all third countries which fall under this provision. 
In the absence of a decision under Article 12(3) of the Regulation, Article 12 does not confer any 
advantage onto a third country. 
                                                      
111 Panel Report, Canada – Autos , para. 10.24. 
112 The EC notes that Australia seems to share this view, since it reserves to make a claim in regard to 
most-favoured-nation treatment only in the event that the EC "is applying" or "begins to apply Community-wide protection to EC-defined GIs for foodstuffs and agricu ltural products from another WTO Member" (Australia's 
FWS, para. 65).  WT/DS174/R/Add.2 
 Page B-67 
 
 
 241. In support of its claim, the United Stat es has referred to the GATT Panel Report in Belgian 
Family Allowances .113 However, this Panel report does not  support the proposition of the United 
States. In this case, Belgium had in fact granted an exception from a certain levy to a number of third 
countries.114 This resembled the situation in EEC – Imports of Beef from Canada , where the Panel 
found as follows:115 
 
The Panel further found that exports of like products of other origin than that of 
United States were in effect denied access to the EEC market considering that the 
only certifying agency authorized to certify the meat described in Article 1(1)(d), 
listed in Annex II of the Commission Re gulation, was a United States agency 
mandated to certify only meat from the United States. 
(b) The Panel further found that the mention "Beef graded USDA 'choice', or 
'prime' automatically meets the definiti on above" could accord an advantage to 
products of United States' origin in so fa r as other like products were not mentioned 
in the same manner. The Panel found, however , that only the practical application of 
the Commission Regulation would make it possi ble to judge whether this mention in 
itself was inconsistent with Artic le I of the General Agreement. 
4.3 The Panel concluded that Commission Regulation (EEC) No. 2972/79 and its 
Annex II, in their present form had the effect of preventing access of "like products" from other origin than the United States, thus being inconsistent with the most-
favoured-nation principle in Article I of the General Agreement.
 
242. In both cases, it was the granting of c oncrete advantages to specific countries  which led the 
Panels to find a violation of the most-favoured-natio n principle. This is fundamentally different from 
the situation under Article 12 of Regulation 2081/92,  which merely provides for the conditions under 
which Regulation 2081/92 may apply to geographica l indications from third countries which are not 
WTO members. 
 
243. The United States has also referred to a Join t Declaration of the European Community and 
Switzerland made on occasion of the signature of the Agreement between the European Community 
and Switzerland on Trade in Agricultural Products.116 This declaration reads in full as follows:117 
 
The European Community and Switzerland (hereinafter referred to as "the Parties") 
hereby agree that the mutual protection of designations of origin (PDOs) and 
geographical indications (PGIs) is essential for the liberalisation of trade in agricultural products and foodstuffs between the Parties. The incorporation of 
provisions relating thereto in the bilateral Agreement on trade in agricultural products 
is a necessary addition  to Annex 7 to the Agreement on trade in wine-sector products, 
and in particular Title II thereof, whic h provides for the mutual protection of the 
names of such products, and to Annex 8 to the Agreement on the mutual recognition 
and protection of names of spirit drinks  and aromatised wine-based drinks.  
The Parties shall provide for provisions on the mutual protection of PDOs and PGIs 
to be incorporated in the Agreement on trad e in agricultural products on the basis of 
equivalent legislation, as regards both th e conditions governing the registration of 
                                                      
113 US FWS, para. 115. 
114 Panel Report, Belgian Family Allowances , para. 3. 
115 Panel Report, EEC – Imports of Beef from Canada, paras. 4.2–4.3. 
116 US FWS, para. 119. 
117 Exhibit US-6 (emphasis added). WT/DS174/R/Add.2 
Page B-68  
 
 PDOs and PGIs and the arrangements on controls. The incorporation of those 
provisions should take place on a date which is acceptable to both Parties , and not 
before Article 17 of Council Regulation (EEC) No 2081/92 has been fully applied as 
regards the Community as constituted at pr esent. In the meantime, the Parties shall 
keep each other informed of th eir work in this area while taking legal constraints into 
account . 
244. This declaration is merely a political declar ation stating the intention of the parties to 
incorporate, at a later stage, provisions on the protection on geographical indications into the Agreement on Trade in Agricultural Products. No such provisions have so far been incorporated into 
the Agreement between the EC and Switzerland. This  declaration is therefore irrelevant for the 
purposes of the present dispute. 
 245. Accordingly, Article 12 of Regulation 20 81/92 does not grant any advantage, favour, 
privilege or immunity to any other country.  
(d) The conditions for the registration of geogra phical indications do not depend on nationality 
246. Finally, as the United States has recognised itself,
118 Article 4 TRIPS establishes a most-
favoured-nation obligation as regards the treatme nt of nationals, whereas Article I:1 GATT 
establishes a most-favoured-nation obligation with resp ect to products. As the EC has set out above, 
this difference between the TRIPS and the GATT is  not accidental, but results from the different 
object and purpose of both agreements.119 
 
247. Furthermore, as the EC has already set out with respect to the claims regarding national 
treatment under the TRIPS, whether a geographical  indication can be registered under Regulation 
2081/92 does not depend in any way on nationality.120 In particular, Article s 12a and 12b govern the 
registration of geographical indications where the ar ea to which the indication is related is located 
outside the EC, and this irrespective of the na tionality of producers. This means that where a 
geographical indication from a third country is protected under the Regulation, this protection also extends to producers which are nationals of other third countries.   248. For all the reasons set out above, the United States claim must be rejected.  2. Claim 17: Under Regulation 2081/92, an EC Member State grants more favourable 
treatment to nationals from other EC Member  States than it accords to nationals from 
non-EC WTO Members  
249. The United States has claimed that under Re gulation 2081/92, an EC Member State grants 
more favourable treatment to nationals from other EC Member States than it accords to nationals from 
non-EC WTO Members.
121 
 250. In the view of the EC, this argument mu st fail already because under Regulation 2081/92, 
geographical indications from third countries whic h are WTO Members are protected on the same 
terms as geographical indications from other Member States.
122 
 
                                                      
118 US FWS, para. 108. 
119 Above para. 104. 
120 Above para. 123 et seq. 
121 US FWS, para. 121. 
122 Above para. 134 et seq.  WT/DS174/R/Add.2 
 Page B-69 
 
 
 251. Secondly, as the EC has already set out, the conditions for the registration of geographical 
indications do not depend on nationality.123 Accordingly, the EC is not discriminating between third-
country nationals on the basis of nationality.  252. Finally, it should be noted that Article 4 TRIPS requires WTO Members to extend to other 
Members the advantages, favours, privileges or immun ities that they grant to "the nationals of any 
other country ". However, through Regulation 2081/92, the EC is not granting an advantage to the 
national of "any other country".  253. Regulation 2081/92 is a m easure which the EC has adopted on the basis of its own 
competences, and which applies throughout the EC. In accordance with Articles IX:1 and XIV:1 of 
the WTO Agreement, the European Community is an  original member of the WTO. Measures with 
which the EC harmonises the law inside the Euro pean Community can therefore not regarded as 
granting advantages to "other countries".  
254. The fact that the EC Member St ates are also Members to the WTO
124 is irrelevant in this 
respect. The measure at issue is a Regulation adopted  by the EC. It is not a measure of the Member 
States. Accordingly, it cannot be said that through Regulation 2081/92, Member States are granting one another "advantages".  255. Finally, since the measure at issue is an EC  measure, the subject matter of the present dispute 
falls within the exclusive competence of the EC, a nd not of the Member States. The United States has 
accepted this by correctly bringing  the present dispute settlement pro ceedings against the EC. It can 
therefore not now raise a claim assuming a violati on of most-favoured-nation-obligations on the part 
of the EC Member States.  
256. Accordingly, this claim of the United States must be rejected. 
 B. C
LAIM 18: BY SUBJECTING THE REGISTRATION OF THIRD -COUNTRY GEOGRAPHICAL 
INDICATIONS TO CONDITIONS OF RECIPROCITY AND EQUIVALENCE , THE EC MEASURE IS 
INCONSISTENT WITH THE MOST -FAVOURED -NATION OBLIGATION UNDER THE ARTICLE  I:1 
GATT 
257. The United States has argued that by subjecting the registration of third-country geographical 
indications to conditions of reciproc ity and equivalence, the EC measure  is inconsistent with the most-
favoured-nation obligation under Article I:1 GATT.125 
 
1. Article I:1 GATT is not violated 
258. Contrary to the claim of the United States, there is no violation of Article I:1 GATT.  
 259. Article I:1 GATT requires in relevant part that "[...] with respect to all matters referred to in 
paragraphs 2 and 4 of Article III,  any advantage, favour, privilege or immunity granted by any 
contracting party to any product originating in or destined for any other country shall be accorded 
immediately and unconditionally to the like product orig inating in or destined for the territories of all 
other contracting parties". 
 260. As the EC has already set out with respect to Article 4 TRIPS, Regulation 2081/92 does not involve any less favourable treatment of WTO members compared to other third countries.  
                                                     
 
123 Above, para. 137. 
124 US FWS para. 121. 
125 US FWS para. 127 et seq. WT/DS174/R/Add.2 
Page B-70  
 
 261. First of all, the EC does not apply a c ondition of reciprocity and equivalence for the 
registration of geographical indications from other WTO members, which can therefore be registered 
as geographical indications under the co nditions set out in Regulation 2081/92.
126 
 262. Secondly, as the EC has also explained, th e conditions for the registration of geographical 
indications from third countries are not discriminatory.
127 
 263. Finally, as the EC has also set out, Article 12 of Regulation 2081/92 does not grant any advantage, favour, privilege or immunity, bu t merely sets out the conditions under which 
geographical indications from third countries other than WTO members may be registered.
128 
 
264. For these reasons, Regulation 2081/92 is not  incompatible with Article I:1 GATT. 
 
2. The EC measure would be justified under Article XX (d) GATT 
265. It is unclear to the EC whether the compla inants claim that the requirements imposed by 
Article 12a, in conjunction with Articles 4 and 10,  of Regulation 2081/92 with respect to the 
registration of each specific geographical indication ar e as such incompatible with Article I:1 of the 
GATT. As shown above, the EC consid ers that those requirements are fu lly consistent with Article I:1 
of the GATT.  266. In the event that the complainants were to cl aim that such requirement s are inconsistent with 
Article I:1 of the GATT, and should the Panel find that  they are inconsistent with that provision, the 
EC submits in the alternative that such requireme nts would be justified under Article XX(d) of the 
GATT, for the same reasons already advanced in  connection with the complainants' claim under 
Article III:4 of the GATT.   VI. REGULATION 2081/92 DOES NOT DIMI NISH THE LEGAL PROTECTION OF 
TRADEMARKS  
267. The complainants have raised a number of claims to the effect that Regulation 2081/92 
diminishes the legal protection of trademarks. Th e EC will show hereunder that these claims are 
unfounded.  
A. A
RTICLE  16.1  OF THE TRIPS  AGREEMENT  
1. Claim 19: Article 14(2) of Regulation 2081/92 is inconsistent with Article 16.1 of the 
TRIPS Agreement in that it allows the co -existence of geographical indications and 
earlier registered trademarks 
268. The complainants claim that Article 14(2) of Regulation 2081/92 is inconsistent with 
Article 16.1 of the TRIPS Agreement in that it allows  the "co-existence" of a registered geographical 
indication and a prior similar or identical register ed trademark for similar or identical goods, which 
results in a likelihood of confusion. 129 
 269. As will be shown in this section, th is claim is unfounded for several reasons. 
 
                                                     
 
126 Above para. 231 et seq. 
127 Above para. 235 et seq. 
128 Above para. 239 et seq. 
129 Australia's FWS, paras. 100-107. US FWS, paras. 130-170.  WT/DS174/R/Add.2 
 Page B-71 
 
 
 270. First, this claim is based on a misunde rstanding of the relevant provisions of 
Regulation 2081/92. Contrary to the complainants ' assumption, Article 14(3) of Regulation 2081/92 
prevents the registration of geographical indicati ons that would result in a likelihood of confusion 
with an earlier trademark. Thus, as a matter of fact , the situation alleged by the complainants does not 
even arise. 
 
271. Second, the exclusivity conferred upon the trademark owners by Article 16.1 of the TRIPS 
Agreement is without prejudice to the protection th at Members are entitled to accord to geographical 
indications in accordance with Part II, Section 3,  of the TRIPS Agreement. The boundary between a 
Member's right to protect geographical indications a nd its obligation to protect trademarks is defined 
by Article 24.5 of the TRIPS, which provides for the co-existence of geographical indications and 
earlier trademarks. Article 14(2) of Regulation 2 081/92 is fully consistent with Article 24.5.  
 272. Third, irrespective of whether the co-exi stence of geographical indications and earlier 
trademarks is permitted by Article 24.5, the EC is re quired to maintain such co-existence by virtue of 
Article 24.3 of the TRIPS Agreement, a "stand- still" provision that prohibits Members from 
diminishing the level of protection of GIs that existed at the time of entry into force of the WTO Agreement.   273. Finally, even assuming that Artic le 14(2) of Regulation 2081/92 were prima facie  inconsistent 
with Article 16.1, it would be justified as a "lim ited exception" to the trademark owner's exclusive 
rights under Article 17 of the TRIPS Agreement. 
 (a) Regulation 2081/92 does not allow the re gistration of confusing trademarks 
274. The exclusivity conferred by Article 16.1 of  the TRIPS Agreement is not absolute. That 
provision does not grant to the owner of a registered  trademark a right to prevent any possible use of 
the same or a similar sign, but only its use for iden tical or similar goods, "where such use would result 
in a likelihood of confusion".  275. As will be shown below, because of the crite ria of registrability applied under EC trademark 
law, the risk of confusion between trademarks  and geographical indications is very limited a priori . 
To the extent that those criteria do not preclude su ch possibility, the problem is addressed adequately 
by Article 14(3) of Regulation 2081/92, which provides that 
 
A designation of origin or geographical indication shall not be registered where, in the light of a trademark's reputation and renown and the length of time it has been used, registration is liable to mislead the consumer as to the true identity of the 
product. 
276. The complainants have erroneously charact erized Article 14(3) as a "narrow exception".
130 As 
explained below, the terms of Article 14(3), if prop erly interpreted, are su fficient  to prevent the 
registration of any confusi ng geographical indications. 
 277. According to their own interpretation of Artic le 16.1 of the TRIPS Agreement, in order to 
establish a violation of that provision, the complain ants would need to prove that Regulation 2081/92 
mandates necessarily the registration of confusing geographical indications. The complainants have 
failed to do so. Indeed, the complainants have not even shown that the actual application of 
Regulation 2081/92 has resulted occasionally in th e registration of confusing geographical 
indications. As of the date of establishment of this Panel, the EC authorities had registered more than 
600 geographical indications. The complainants have not  alleged, let alone prove d, that any of those 
                                                     
 
130 US FWS, para. 158. WT/DS174/R/Add.2 
Page B-72  
 
 geographical indications has resulted in a likelihood of  confusion with any prior registered trademark. 
The complainant's claim is purely theoretical and, as will be shown below, unfounded.   
 
(i) Registrability of geogra phical names as trademarks 
278. The purpose of a trademark is to distinguish the goods or services of one undertaking from 
those of other undertakings. A sign that cannot fulfil this function, i.e. a sign which is not 
"distinctive", cannot be registered as a trademar k. Thus, Article 15.1 of the TRIPS Agreement 
provides that  
Any sign, or any combination of signs, capable of distinguishing the goods or 
services of one undertaking from those of ot her undertakings, shall be capable of 
constituting a trademark.
131 
279. Geographical names are primarily "non-distinc tive" and, as such, non apt for registration as 
trademarks.132 For example, the name "Australia", if u sed as a trademark by an undertaking, would 
not allow to distinguish the goods of that undertak ing from those of any other Australian undertaking 
selling the same or similar products. Moreover, the use of geographical names as trademarks may be 
deceptive in so far as they are used  for goods which do not originate in the location designated by that 
name. For example, the name "Australia", if u sed as a trademark for US goods, could mislead the 
consumers as regards the origin of the goods.  280. For the above reasons, the registration of ge ographical names as trademarks is subject to 
restrictions in all countries.
133 Broadly speaking, it is permitted onl y in two situations: first, where 
consumers would not expect the goods to be produced in that place; and, second, where the name has 
become distinctive through use. In other words,  when, as a result of its continued use by an 
undertaking, the geographical name acquires a "s econdary meaning", so that consumers do not 
associate it with a geographical location but instead with the undertaking in question.134  T h i s  
possibility is expressly envisaged in the second sen tence of Article 15.1 of the TRIPS Agreement, 
which provides that 
                                                      
131 Similarly, Article 6 quinquies  B (2) of the Paris Convention (1967) provides that the registration of  
trademarks may be denied "when they ar e devoid of any distinctive character". 
132 Article 6 quinquies  B of the Paris Convention (1967) provides that trademarks may be denied 
registration when  
 
2. …  they consist exclusively of signs or indications which may serve, in trade, to 
designate the … place of origin; 
 
3. when they are … of such a na ture as to deceive the public.   
133 Section 2 of the US Lanham Act prohibits the registration of trademarks that, when used in 
connection with the goods of the appli cant,  are "primarily geographically de scriptive", unless they have become 
distinctive through use, or "primarily geographically deceptively misdescrip tive" (15 USC. 1052 (e) and (f)). 
(Exhibit EC-6). 
 
 Similarly, Australia's Trade Marks Act of 1995 pr ohibits the registration of trademarks that are not 
"inherently adapted to distinguish goods or services" unless they have become distinctive through  use. Trademarks that are not "inherently ad apted to distinguish goods or services" include  "trade marks that consist 
wholly of a sign that is ordinarily used to indicate: (a) the … geographical origin… " (Section 41(6) Note 1 (a)) 
(Exhibit EC-7)  
134 A well known example of trademark consisting of a geographical name which has become 
distinctive through use in some countries is "Budwei ser". After much litigation in the United States, it was 
deemed to have acquired secondary meaning in that country , so that it could be registered as a trademark. See 
Albrecht Conrad, "The Protection of Geographical Indications in the TRIPS Agreement",  86 The Trademark 
Reporter , p.43.  WT/DS174/R/Add.2 
 Page B-73 
 
 
  
Where signs are not inherently capable of distinguishing the relevant goods or services, Members may make registrability depend on distinctiveness acquired through use.  
281. Like in other jurisdictions, in the EC the re gistration of geographical names as trademarks is 
permitted only exceptionally. Article 3.1 of the Tradem arks Directive provides that the following shall 
not be registered or, if registered, sh all be liable to be declared invalid: 
 
(b) trade marks which are devoid of any distinctive character; 
(c) trade marks which consist exclusivel y of signs or indications which may 
serve, in trade, to designate … the geographical origin; 
(g) trade marks which are of such nature  as to deceive the public, for instance as 
to the … geographical origin of the goods…
135 
282. The European Court of Justice has held that: 
 
under Article 3(1)(c) of the Directive, the competent authority must assess whether a 
geographical name in respect of which application for registration as a trade mark is made designates a place which is currently associated in the mind of the relevant 
class of persons with the category of goods concerned, or whether it is reasonable to 
assume that such an association ma y be established in the future.
136  
283. By way of exception to letters (b) and (c) of Ar ticle 3.1 (but not to letter (g)), Article 3.3 of 
the Trademarks Directive provides that geographical names that are primarily non-distinctive may be 
registered where they have become distinctive through use:  
A trademark shall not be refused registrati on or be declared invalid in accordance 
with paragraph 1 (b), (c) or (d) if , before  the date of application for registration and 
following the use which has been made of it, it has acquired a distinctive character.
137  
                                                      
135 Similarly, Article 7(1) of the Commun ity Trademark Regulation provides that: 
 
 The following shall not be registered:  
 (b) trade marks which are devoid  of any distinctive character; 
 (c) trademarks which consist exclusively of signs or indications which may serve, in trade, to designate  
the…geographical origin of  the goods or service; 
  … 
 
(g) trade marks which are of such a nature as to  deceive the public, for instance as to the  … 
geographical origin of the goods or service; 
136 Judgement of the European Court of Justice of 4 May 1999, C-108/97 and C-109/97, Chiemsee , 
ECR [1999] I-2779, para. 37. (Exhibit EC-8). 
137 Similarly, Article 7 (3) of the Community Trademark Regulation provides that 
 
Paragraph 1(b), (c) and (d) shall not apply if th e trade mark has become distinctive in relation 
to the goods or services for which registration is required in consequence of the use which has 
been made of it.   WT/DS174/R/Add.2 
Page B-74  
 
 284. In sum, under EC law, the registration of a geographical name as a trademark is  possible only 
in the following circumstances:  
• where the geographical name is not curre ntly associated, and it can be reasonably 
assumed that it will not be associated in the fu ture, with the product concerned; or   
 
• where the name has acquired distinctiveness through use. 
 285. In principle, any geographical name which qualifies, or may reasonably qualify in the future, 
as a "designation of origin" or a "geographical indi cation" within the meaning of Article 2(2) of 
Regulation 2081/92, will not fall within the first situa tion. Thus, it may be concluded that, in practice, 
a geographical indication, or a geographical name  with the potential to become a geographical 
indication, may not be validly registered as a trad emark unless it has become distinctive through use. 
 
(ii) Article 14(3) of Regulation 2081/92 
286. The complainants' claim is based on an unwa rrantedly narrow interpretation of Article 14(3) 
of Regulation 2081/92. When properly interpreted, th at provision allows the registering authorities to 
refuse the registration of any confusing geographical indications.  
 287. Australia does not even attempt to interpret th e terms of Article 14(3). For its part, the United 
States declares it to be a "narrow exception"
 138 after a cursory analysis. Moreover, the United States 
reaches that conclusion by reading into Article 14( 3) additional requirements which are not stated in 
that provision. Thus, according to the United States, this provision would exclude the registration of a 
geographical indication "only where the trademark has been used for a long time  and has a 
considerable  reputation or renown".139  Neither of those two qualifications is provided in 
Article 14(3).  288. Article 14(3)  has been applied only once by the EC authorities since Regulation 2081/92 
came into force.
140 It has never been interpreted by the Europ ean Court Justice or by the courts of the 
Member States . This confirms that, as explained above, the criteria for the registrability of trademarks 
ensure that the potential for conflicts between tradem arks and geographical indications is indeed very 
limited.  
289. The EC Commission considers that the criteria listed in Article 14(3) are not limitative. The 
registering authority may take into account also ot her relevant criteria in order to assess whether the 
registration of the geographical indication will result in a likelihood of confusion. For example, it is 
obvious that the degree of similarity between the signs or between the goods concerned is always 
relevant in assessing the likelihood of confusi on between two signs for goods. Nevertheless, given 
that geographical names are primarily non-distinctive as trademarks, the two criteria specified in 
Article 14(3) will often be of partic ular relevance in practice. It is  for that reason, and not because 
they are the only relevant criteria, that the regist ering authorities are directed expressly to consider 
those two criteria.  
                                                     
 
138 US FWS, para. 158. 
139 Ibid. 
140 In that case, the EC Council concluded that the registration of the GI "B ayerisches Bier" was not 
likely to lead to confusion with the existing trademar ks "Bavaria" and "Hoker Bajer"; Council Regulation (EC) 
No 1347, of 28 June 2001, OJ (2001) L 182. (Exhibit EC-9).  WT/DS174/R/Add.2 
 Page B-75 
 
 
 290. It is well-established that the more distinc tive the trademark the greater the likelihood that 
consumers will confuse another sign with that trademark141. As explained above, geographical names 
are primarily non-distinctive. Thus, the degree of distinctiveness and, consequently, the likelihood 
that it may be confused with a geographical indica tion will depend to a large extent on the degree of 
distinctiveness which the trademark has acquired thr ough use. In turn, the basic criteria to measure 
such acquired distinctiveness are the length of time during which the trademark has been used and the 
extent of the reputation or renown acquired as a result of such use.   291. Consumers are unlikely to confuse a geographi cal indication with a trademark that has never 
been used and/or has no reputation or renown simply because the signs and/or the goods concerned 
are similar. In fact, as explained above, a trademar k consisting of a geographi cal indication, which has 
never been used or which has no reputation or renow n, should not have been registered in the first 
place because it would lack the required distinctiveness.  
(iii) Provisional conclusion 
292. In order to substantiate their claim that Ar ticle 14(2) of Regulation 2081/92 is inconsistent 
with Article 16.1 of the TRIPS Agreement, the comp lainants should  have established that Regulation 
2081/92 mandates necessarily the registration of later confusing geographical indications. In turn, this 
would have required them to show that Article 14(3) cannot be inte rpreted in a manner which allows 
the registering authorities to refuse the registration of confusing geographical indications, or, at the 
very least, that, in practice, Article 14(3) is being interpreted and applied in a manner which results in 
the registration of confusing geographical indi cations. The complainants have proved neither. 
 293. Therefore, the Panel should conclude that, as a matter of fact, the complainants' claim is 
unfounded even on their own interpretation of Article 16.1 of the TRIPS Agreement. In any event, as 
discussed below, that interpretation is incorrect.  
 
(b) Article 24.5 envisages the co-existence of GIs and earlier trademarks 
294. The complainants' claim rests on a misconcepti on of the relationship between trademarks and 
geographical indications, as well as between Article 16.1 and Part II, Section 3, of the TRIPS Agreement. The TRIPS Agreement recognises geographi cal indications as intellectual property rights, 
on the same level as trademarks. It confers no superi ority to trademarks over geographical indications. 
Nor are the provisions of Part II, Section 3, "exceptions" to Article 16.1. There is no hierarchy 
between them.   295. In an attempt to establish the superiority of trademarks over geographical indications, the 
complainants emphasise that exclusivity is an essenti al feature of trademarks. It is, of course, correct 
that trademarks are exclusive rights. But from this it does not follow that trademarks must prevail over 
geographical indications. Geographical indications are also exclusive rights, because their basic purpose, like that of trademarks, is to distingu ish the goods from a certain source. The fact that 
geographical indications are collective rights does not  render their exclusivity less indispensable. If 
any producer of cheese could use the term "Roquefort ", the geographical indication "Roquefort" could 
not fulfil its distinctive function and woul d be deprived of its economic value.  
 
296. As explained above, the criteria for the registrability of trademarks limit a priori  the 
possibility of conflicts between geographical indicati ons and trademarks. However, to the extent that 
geographical indications may exceptionally be valid ly registered as trademarks, there may arise 
                                                     
 
141 Judgement of the European Court of Justice of 11 November 1997, C – 251/95, Sabel , para. 24. 
(Exhibit EC-10). WT/DS174/R/Add.2 
Page B-76  
 
 conflicts between the exclusivity of those two ty pes of intellectual property rights. The question 
before the Panel is, therefore, how to resolve those conflicts.  297. Article 16.1 does not address this issue. More specifically, and contrary to the complainants' 
claims, Article 16.1 contains no provision to the e ffect that trademarks must prevail over later 
geographical indications. The complainants argue th at the right conferred by Article 16.1 to the 
trademark owner in order to prevent the confusing u se of identical or similar "signs" for identical or 
similar goods applies also with respect to late r geographical indications, because geographical 
indications are "signs". True, geographical indications  consist of a special type of "sign": words or 
other signs with a geographical connotation. But they are more than mere "signs". They are a distinct 
intellectual property right, with a specific subject matter and a specific function, different from those 
of trademarks, which Members are entitled to prot ect under their domestic laws and which, indeed, 
they are required to protect under Part II, Section 3, of the TRIPS Agreement.   298. The boundary between geographical indications a nd trademarks is not defined in Article 16.1, 
but instead in Article 24.5 of the TRIPS Agreement.  Therefore, the WTO consistency of Article 14(2) 
of Regulation 2081/92 must be determ ined in relation to that provision, and not with respect to 
Article 16.1.    299. Article 24.5 provides that   
Where a trademark has been applied for or registered in good faith, or where rights to 
a trademark have been acquired through use in good faith either: 
(a) before the date of application of these provisions in that member as defined in 
Part VI; or 
(b) before the geographical indication is  protected in its country of origin; 
measures adopted to implement this Secti on shall not prejudice eligibility for or the 
validity of the registration of a trademark, or the right to use a trademark, on the basis that such trademark is identical with, or similar to, a geographical indication. 
300. Article 24.5 must be read together with Articles 22.3
142 and 23.2143, which require that the 
registration of trademarks must be refused or inva lidated in certain situations. Those two provisions, 
however, do not exhaust the protection afforded to  geographical indications vis-à-vis trademarks. 
Right holders of geographical indications can invoke also Articles 22.2144 and 23.1145 in order to 
                                                      
142 Article 22.3 of the TRIPS Agreement provides that: 
 A Member shall, ex officio  if its legislation so permits, or at the request of an interested party, 
refuse or invalidate the registration of a trademark which contains or consists of a geographical 
indication with respect to goods not originating in the territory indicated, if use of the indication in the trademark for such goods in that Member is of such nature as to mislead the 
public as to the true place of origin. 
143 Article 23.2 of the TRIPS Agreement provides that:  
 
The registration of a trademark for wines which contains or consists of a geographical 
indication identifying wines or for spirits which contains or consists of a geographical indication identifying spirits shall be refused or invalidated, ex officio  if a Member's legislation 
so permits or at the request of an interested pa rty, with respect to such wines or spirits not 
having this origin. 
144 Article 22.2 of the TRIPS Agreement provides that: 
  WT/DS174/R/Add.2 
 Page B-77 
 
 
 prevent the use of a trademark (whether registered  or non-registered) in the circumstances described 
in those provisions. In addition, in implementing Part II, Section 3, Members are entitled to provide 
more extensive protection for geographical indications ,  in accordance with Article 1.1 of the TRIPS 
Agreement.  
301. Article 24.5 has two implications: 
 
• with respect to grandfathered trademarks (or applications for trademarks), Members 
are not allowed to prejudice  the validity of the registration (or the eligibility of the 
application) or the  "right to use the trademark", but they may prejudice  other rights 
of the trademark owner, including in particular the right to prevent others from using 
the sign of which the trademark consists. 
 
• with respect to other trademarks (or applications for trademarks), Members may 
prejudice any right. 
 302. Regulation 2081/92 implements Part II, Sec tion 3, of the TRIPS Agreement. The rule of 
conflict between geographical indications and trademar ks defined in Article 25.4 has been transposed 
by Articles 14(1) and 14(2) of Regulation 2081/92 . Article 14(1) maintains the eligibility of the 
applications and the validity of the registrations "g randfathered" by Article 24. 5. In turn, Article 14(2) 
preserves the right of the owners of "grandfathered" trademarks to continue to use their trademarks 
concurrently with the geographical indications.  
303. Article 14(2) of Regulation 2081/92 is fully c onsistent with Article 24.5, which provides that 
Members shall not prejudice "the right to use a trad emark". That phrase alludes to the owner's right to 
use the sign of which the trademark consists, which is one of the two basic rights of the trademark 
owner, together with the right to prevent other persons from using that sign.
146 If the drafters had 
meant to exclude the co-existence of trademarks  and geographical indications, they would have 
provided instead that Members shall not prejudice "the exclusive  right to use a trademark". 
 
                                                                                                                                                                     
In respect of geographical indications, Members shall provide the legal means for interested 
parties to prevent: 
 
(a) the use of any means in the designation or  presentation of a good that indicates or 
suggests that the good in question originates in a geographi cal area other than the true place of 
origin in a manner which misleads the public as to the geographical origin of the good;   
(b) any use which constitutes an act of unfair competition within the meaning of 
Article 10 bis of the Paris Convention (1967). 
145 Article 23.1 of the TRIPS Agreement provides that: 
 
Each Member shall provide the legal means fo r interested parties to prevent use of a 
geographical indication identifyi ng wines for wines not origina ting in the place indicated by 
the geographical indication in question or identifying spirits for spirits not originating in the 
place indicated by the geographical indication in question, even where th e true origin of the 
goods is indicated or the geographical indication is used in translation or accompanied by 
expressions such as "kind", "type", "style", "imitation" or the like. [footnote omitted] 
146 WIPO's "Introduction to Intellectual Property, Theo ry and Practice" (Kluwer, 1997),  aptly describes 
the rights arising from trademark registration as follows (para. 9.147): 
 
The registered owner has the exclusive right to use the trademark. This short definition of the specific 
subject matter of trademark right encompasses two things: the right to use the trademark and the right 
to exclude others from using it. WT/DS174/R/Add.2 
Page B-78  
 
 304. Furthermore, if Article 24.5 did not allo w co-existence, the protection of geographical 
indications provided under Part II, Section 3, would become pointless whenever there is a grandfathered trademark. Indeed, why protect a ge ographical indication against illegitimate uses by 
third parties if the legitimate users cannot use it themselves? Yet, Article 24.5 assumes that Members 
will continue to protect geographical indications ("…measures adopted to implement this Section 
shall not prejudice…"), notwithstanding the existence of "grandfathered" tradem arks. If the drafters' 
intention had been to prohibit the use of geographi cal indications concurrently with grandfathered 
trademarks, they would have excluded completely the applicability of Part II, Section 3, with respect 
to the geographical indications concerned, rather than providing that the implementation of that 
Section shall not prejudice "the right to use the trademark". 
 
305. Australia has suggested
147 that the phrase "the right to use a trademark" alludes exclusively to 
the trademark rights acquired through use, to which reference is made in the introductory phrase of 
Article 24.5. However, if so, it would have been more logical to say that the measures taken to implement Sections 3 "shall not prejudice … the tr ademark rights acquired through use", rather than 
that they "shall not prejudice … the right to u se a trademark". Australia confuses the mode of 
acquisition of the trademark rights (use or registrati on) with one of the basic rights of the trademark 
owner (irrespective of whether the trademark rights have been acquired through use or registration), i.e. the right to use the trademark.  306. Moreover, trademark rights acquired through use are also, as a general rule, exclusive within 
the boundaries of the area in which they have be en used. Article 16.1 of the TRIPS Agreement 
recognises expressly the right of Members to make available trademark rights, including exclusive 
rights, on the basis of use. In view of that, th ere is no good reason why Artic le 24.5 should provide for 
the co-existence of geographical indications and non-registered trademarks, but prohibit the co-
existence of geographical indications and regist ered trademarks, which would be the anomalous 
consequence of Australia's interpretation.  
 307. Co-existence may not be a perfect solution to  resolve conflicts between different types of 
intellectual property rights. But then there is no such  perfect solution. Co-existence is preferable to a 
rigid application of the first-in-time rule, which is what the complainants are proposing. That rule is 
generally appropriate to resolve conflicts betw een trademarks, but not between trademarks and 
geographical indications, because they are distinct  intellectual property rights, each with its own 
characteristics. In particular, the following differences make inappropriate the stri ct application of that 
principle to conflicts between geogr aphical indications and trademarks: 
 
• trademarks are much easier to create than  geographical indications. Trademarks can 
be acquired almost instantaneously, simply by an "intent to use" or by the mere 
lodging of an application with a registration system. In contrast, the creation of a 
geographical indication requires to establis h first a "link" between the name and 
certain product characteristics, which may require years. Indeed, as is often the case in the EC, such link is the result of centu ries of tradition. Thus, the first-in-time 
principle would provide an unfair advantage to trademark owners; 
 
• trademarks are arbitrary, with the consequence that there is a virtually unlimited 
choice of trademarks. By choosing delibera tely a geographical name as a trademark, 
an undertaking accepts the risk that the sa me sign may be used concurrently as a 
geographical indication. In contrast, geogr aphical indications are "necessary" in the 
sense that the range of names used to designate a certain geographical is limited a 
priori  by well established usage. Right holders  of geographical indications may not 
                                                     
 
147 Australia's FWS, para. 74.  WT/DS174/R/Add.2 
 Page B-79 
 
 
 easily change the name given by the public to the geographical area where they are 
located. For that reason, it is much more difficult to find an alternative geographical 
indication than it is to find an alternative trademark; 
 
• geographical indications serve to inform consumers that the product originates in a 
certain area and has certain characteristics linked to that origin. Trademarks only 
guarantee the identity of the undertaking that markets the product. Thus, in addition to having a commercial function, geographi cal indications serve a public interest, 
which deserves additional protection. 
 
• geographical indications are the common patrimony of all the producers of a certain 
area, and ultimately of the entire population of that area, which may potentially 
qualify for the right to use the geographical indication. It would be unfair to deprive 
that population from the use of a geographical indication for the exclusive benefit of an individual  trademark owner, who may or may not have contributed to the development of the geographical indication,  simply because he happened to register 
that name first as a trademark. 
 
308. The co-existence of intellectual property rights is by no means an unusual solution for resolving conflicts between intellectual property ri ghts, including between trademarks. Indeed, several 
other provisions of the TRIPS Agreement provide for co-existence:   
• Article 23.3 provides for co-existence betw een homonymous geographical indications 
for wines;
148 
 
• Article 24.4 permits, under certain circumstanc es, that the nationals or residents of 
one Member continue to use a geographical  indication of another Member in co-
existence with the users of that Member;149 
 
• Article 16.1 itself provides that the exclusivity of registered trademarks "shall not 
prejudice any existing prior rights". 
 
309. The co-existence of different types of intell ectual property rights, and in particular between 
geographical indications and trademarks, is provided also in the law of other Members.150  
 
                                                      
148 Article 23.3 of the TRIPS Agreement provides that: 
 
In the case of homonymous geographical indications for wines, protection shall be accorded to 
each indication, subject to the provisions of paragraph 4 of Article 22. Each Member shall 
determine the practical conditions under which the homonymous indications in questions will 
be differentiated from each other, taking into acco unt the need to ensure equitable treatment of 
the producers concerned and th at consumers are not misled. 
149 Article 24.4 of the TRIPS Agreement provides that: 
 
Nothing in this section shall require a Member to prevent continued and similar use of a particular geographical indication of another Member identifying wines or spirits in connection 
with goods or services by any of its nationals or domiciliaries who have used that geographical 
indication in a continuous manner with regard to the same or related goods or services in the territory of that Member either (a) for at least 10 years preceding 15 April 1994 or (b) in good 
faith preceding that date. 
150 See "Review under Article 24.2 of the Applicati on of the Provisions of the Section of the TRIPS 
Agreement on Geographical Indications – Summary of the Responses to the Checklist of Questions", 
IP/C/W/253/Rev.1, 24 November 2003, paras. 149-150. WT/DS174/R/Add.2 
Page B-80  
 
 310. Remarkably, the United States itself provides fo r the co-existence of geographical indications 
and earlier trademarks with respect to wines. Specifically, the regulations of the US Alcohol and Tobacco Tax and Trade Board (the "TTB") provide that a brand name of viticultural significance 
(including the name of US approve d viticultural areas) may not be used unless 1) the wine meets the 
appellation of origin requirements for the geographical  area concerned; or 2) the brand name is used 
in accordance with a "certificate of labe l approval" issued prior to 1 July 1986.
151 
 311. In other words, under the TTB Regulations, th e existence of a registered trademark including 
a geographical name (e.g. "Rutherford Vintners") does not prevent the subseq uent recognition and use 
of that name as a geographical indication ("Ruther ford"), which is what would be required by the 
interpretation of Article 16.1 of the TRIPS Agre ement put forward by the United States in this 
dispute. Quite to the contrary, the use of the earlier trademark is prohibited, subject to a very limited 
temporal exception, with a narrower scope than that of Article 24.5 of the TRIPS Agreement. 
Furthermore, grandfathered trademarks are allowed to  co-exist with the later geographical indications, 
provided only that they are used in accordance with  special labelling requirements. The United States 
should explain why this solution to the conflic ts between geographical indications and earlier 
trademarks, which is undoubtedly a sensible one, must be deemed compatible with the TRIPS Agreement when US geographical indications for wines are at stake, but not in the case of EC geographical indications for other products.
152 
 (c) The EC is required to maintain the co-exist ence of geographical indications and earlier 
trademarks by Article 24.3 
312. Irrespective of whether the co-existence of ge ographical indications and earlier trademarks is 
consistent with Article 24.5, the EC is required to maintain such co-existence by virtue of Article 24.3 
of the TRIPS Agreement, which provides that  
In implementing this Section, a Member shall not diminish the protection of 
geographical indications that existed in that  Member immediately prior to the date of 
entry into force of the WTO Agreement. 
313. Article 24.3 is in the nature of a "stand still"  obligation. It requires Members to maintain at 
least the level of protection of geographical indica tions that they applied immediately prior to the 
entry into force of the WTO Agreement, where su ch level is higher than the level of protection 
required by Part II, Section 3, of the TRIPS Agreement.
153 
 314. Regulation 2081/92 was adopted on 14 July 1992 and entered into force on 14 July 1993. As of 31 December 1995, i.e. the day before the entry in to force of the WTO Agreement, Article 14(2) of 
Regulation 2081/92 provided for the co-existence of  geographical indications and earlier trademarks. 
If the EC were to allow now the owners of prior re gistered trademarks to prevent the use of later 
geographical indications, as demanded by the complain ants, it would be diminishing the protection of 
geographical indications, contrary to the ob ligation imposed upon the EC by Article 23.4 
                                                     
 
151 27 CFR 4.39 (i). (Exhibit EC-11). 
152 The lack of consistency appears to be even mo re blatant in the case of Australia. The Wine and 
Brandy Corporation Act prohibits the use of a register ed GI for wine which does not originate in the area 
covered by the GI. No exception is provided with respect  to prior trademarks. Australia can hardly complain 
about the fact that the EC  allows the co-existence of GIs with earlier trademarks grandfathered under 
Article 24.5, when it prohibits the use of those trademar ks, unless the wine originates in the area designated by 
the GI. (Sections 40 D-F). (Exhibit EC -12).  
153 See e.g. Daniel Gervais, The TRIPS Agreement, Drafting History and Analysis , (Sweet & Maxwell, 
1998), p. 135.  WT/DS174/R/Add.2 
 Page B-81 
 
 
 (d) In any event, the co-existence of geographical  indications and earlier trademarks would be 
justified under Article 17 of the TRIPS Agreement  
315. Assuming that 14(3) of Regulation 2081/92 did not prevent the registration of confusing 
geographical indications, and assuming further that the co-existence of geographical indications and 
earlier registered trademarks were neither consiste nt with Article 24.5 of the TRIPS Agreement nor, 
in the case of the EC, required by Article 24.3 of  the TRIPS Agreement, the EC submits in the 
alternative that such co-existence would be jus tified under Article 17 of the TRIPS Agreement. 
 316. Article 17 states that:   
Members may provide limited exceptions to th e rights conferred by a trademark, such 
as fair use of descriptive terms, provided that such exceptions take account of the 
legitimate interests of the owner of the trademark and of third parties. 
317. Article 14(2) is a "limited exception" because it allows the concurrent use of the geographical 
name registered as a trademark only by those producers who are established in the geographical area 
designated by the geographical indication and who, furthermore, comply with the relevant product 
specifications and other requirements for using th e geographical indication. The trademark owner 
retains the exclusive right to prevent the use of that name by any other persons.   318. Moreover, Article 17 mentions expressly as an example of "limited exception" the "fair use of 
descriptive terms". Geographical indications are "descriptive terms".
154 The use of a geographical 
indication in order to indicate the true origin of the goods and the characteristic associated to that 
origin is certainly a "fair" use of that descriptive term.        319. Finally, the legitimate interests of the trademark owner and of third parties are "taken into account" in several ways:  
 
• even if Article 14(3) of Regulation 2081/92 did not avoid completely the registration 
of confusing trademarks, it would at the very least prevent the most significant cases of confusion, in the interest of both the trademark owner and the consumers; 
 
• moreover, the concurrent use of the geogr aphical indications is subject to the 
generally applicable EC legislation on labe lling and misleading advertising, as well as 
to the laws of the Member States on unfair competition; 
 
• finally, geographical indications serve to inform consumers about the origin of the 
products and their characteristics and, therefore, "take account of the interests of third parties" also in that way.  
                                                     
 
154 The trademark laws of both the Un ited States and Australia provide that the use of a term registered 
as a trademark to indicate the origin  of goods does not constitute an  infringement of the trademark. 
 
 Section 33(b)(4) of the US Lanham Act  (15 USC 115 (b) (4))(Exhibit EC-6) provides the following 
defence against a claim of infringement of the exclusive right of a trademark owner: 
 
That the use of a term … charged to be an infri ngement is a use, otherwise than as mark … of 
a term … which is descriptive and used fairly and in good faith only to describe the goods … 
of such party, or their geographical origin. 
 
 In turn, Section 122(1) (b)(i) of Australia's 19 95 Trade Mark Law provides that a person does not 
infringe a registered trade mark when "the person uses a sign in good faith to indicate the … geographical origin 
… of goods." (Exhibit EC-7). WT/DS174/R/Add.2 
Page B-82  
 
  
2. Claim 20: Regulation 2081/92 does not provide for a presumption of a likelihood of 
confusion in the case of use of an identical sign for identical goods 
320. Australia claims that Regulation 2081/1992 is  inconsistent with Article 16.1 of the TRIPS 
Agreement because it does not "implement" the pres umption of a likelihood of confusion in the case 
of use of an identical sign for identical goods.
155 
 321. The EC's response to Claim 19 disposes also of this claim. However, for the sake of 
completeness, the EC would like to add the following comments.  
322. First, contrary to what Australia appears to suggest, Members are not required to reproduce 
explicitly the presumption of Article 16.1 in their do mestic law. It may be sufficient if their domestic 
law leaves to the registering authority, or to the courts, the necessary discretion to apply the 
presumption and, in practice, the presumption is complied with.
156  
 
323. Second, it is extremely unlikely that the s ituation described by Australia will ever present 
itself in practice. In the first place, as explained ab ove, the criteria for the registrability of trademarks 
limit a priori  the possibility to register as a trademark a name which is identical to that of a 
geographical indication or of a potential geogra phical indication. Moreover, the definition of 
"geographical indication" in Regulation 2081/92, t ogether with the requirement to comply with 
certain product specifications, would normally ha ve the consequence that the goods covered by a 
registered geographical indication are not identical to  other goods. In any even t, should the situation 
arise, Article 14(3) would allow the registering authority to refuse the registration of a proposed geographical indication, if necessary to implement the presumption.  324. Finally, Australia's complaint is, once again, purely theoretical. Australia has not alleged, let 
alone proved that any of the more than 600 register ed geographical indications is identical to any 
earlier registered trademark used for identical goods.  The EC considers that none of the registered 
geographical indications falls within that situation.     
3. Claim 21:  Article 7(4) of Regulation 2081/92 is inconsistent with Article 16.1 of the 
TRIPS Agreement because it limits the grounds of objection 
325. Australia (but not the United States) claims  that Article 7(4) of Regulation 2081/92 is 
inconsistent with Article 16.1 of the TRIPS Agreement
157 because it does not allow trademark owners 
to object to the registration of a proposed geographical indication where there is likelihood of confusion, but only where the proposed geographical indication would "jeopardize the existence of an 
entirely or partly identical trademark."
  
 
326. This claim is unfounded, both as a matter of law, because Article 16.1 does not confer a right 
of objection, and as a matter of fact, because Ar ticle 7(4) of Regulation 2081/92 does not limit the 
grounds of objection in the manner alleged by Australia.  
                                                     
 
155 Australia's FWS,  para. 93.  
156 Thus, for example, the EC understands that the US trademark laws do not restate the presumption, 
but the US authorities are satisfied that the criteria usua lly applied in order to appreciate the likelihood of 
confusion between trademarks are su fficient to meet the presumption. 
157 Australia's FWS, paras. 88-92.  WT/DS174/R/Add.2 
 Page B-83 
 
 
 (a) Article 16.1 of the TRIPS Agreement does not confer a right of objection 
327. Article 16.1 does not grant to the trademark owners a right to formulate objections in the 
framework of a procedure for the acquisition of an other intellectual property right, whether it is a 
trademark or a different right such as geographical indication.    
328. Article 16.1 regulates exclusively the substa ntive content of the rights conferred to the 
trademark owners. It does not address the procedur al means to exercise those rights, which are 
regulated elsewhere in the TRIPS Agreement. Thus, the possibility to raise objections to the registration of another intellectual property right is  addressed in Article 62.4, with respect to all 
intellectual property rights in general, and in Artic le 15.5, with respect specifically to trademarks. 
 
329. Article 62.4, which is included in Part IV of  the TRIPS Agreement,  dealing specifically with 
the "Acquisition and Maintenance of In tellectual Property Rights and Related Inter Partes  
Procedures",  provides that  
Procedures concerning the acquisition or ma intenance of intellectual property rights 
and, where a Member's law provides for such procedures
, administrative revocation 
and inter partes  procedures such as opposition, revoc ation and cancellation, shall be 
governed by the general principles set out  in paragraphs 2 and 3 of Article 41.158  
330. In turn, Article 15.5 provides that Members "may  afford an opportunity for the registration of 
a trademark to be opposed".159  
 
331. The above quoted provisions make it clear that  Members are not required to grant a right of 
opposition to the trademark owners with respect to  the acquisition of another intellectual property 
right.   
332. Moreover, contrary to Australia's assertions, the right to formulate objections is  not necessary 
to "exercise" effectively the substantive right conf erred by Article 16, if final registration decisions 
are subject to judicial review, as they should under Article 62.5 of the TRIPS Agreement.  333. Since Article 16.1 does not confer to the trad emark owners the right to formulate objections 
with respect to the registration of a geographical  indication, the fact that Article 7(4) of 
Regulation 2081/92 limits the possible grounds of objec tion cannot be inconsiste nt with Article 16.1. 
 (b) Australia has misread Article 7(4) of Regulation 2081/92 
334. In any event, Australia's claim is based on a misreading of Article 7(4) of Regulation 2081/92. 
The text in force of that Article provides in relevant part as follows: 
 
A statement of objection shall be admissible only if it: 
… – shows that the registration of the name proposed would jeopardize the 
existence of an entirely or partly identical name or of a
 mark …160 
                                                      
158 Emphasis added. 
159 Emphasis added. 
160 Emphasis added. WT/DS174/R/Add.2 
Page B-84  
 
 335. The term "entirely or partially identical" qua lifies only the term "name", and not the term 
"mark". Thus, an objection is admissible if the pr oposed name "would jeopardize the existence of the 
mark", regardless of whether the mark is "entirely or partially identical". This is confirmed by the 
other linguistic versions of the Regulation, including  the French and the Span ish ones, which read as 
follows: 
 
Pour être recevable, toute déclaration d'opposition doit : 
… – …  démontrer que l'enregistrement du nom proposé porterait préjudice a 
l'existence d'une dénomination totalement  ou partiellement homonyme ou d'une 
marque … 
Para que sea admitida, toda d eclaración de oposición deberá: 
… – …demostrar que el registro del nombre  propuesto perjudicaría la existencia 
de una denominación total o parcialm ente homónima o de una marca…  
336. The ground provided in Article 7(4), i.e. that  the proposed name "would jeopardize ("porterait 
préjudice" in French, "perjudicaría" in Spanish)  the existence of a mark" is broad enough to 
encompass the likelihood of confusion between the proposed name and the trademark.   337. Australia appears to have been confused by the English version of the text in force until the 
amendment introduced by Council Regulation 806/2003, which read as follows: 
 
A statement of objection shall be admissible only if it: 
… – shows that the registration of the name proposed would jeopardize the 
existence of an entirely or partly  identical name or trade mark … 
338. However, no consequences can be attributed to the omission of  the term "of a" before the 
term "trade mark", which appears to have been a translation error. Indeed, the other linguistics 
versions in force until the said amendment, including the French and the Spanis h, were identical on 
this point to the text currently in force in those versions.   
4. Claim 22: Regulation 2081/92 does not ensure that objections from trademark owners 
will be considered by the Committee       
339. Australia (but not the United States) claims that Regulation 2081/92 is inconsistent with 
Article 16.1 because it does not ensure that an objec tion from the owner of a registered trademark is 
considered by the Committee
161, which Australia characterizes as "the ultimate decision maker". 
 
340. For the reasons explained in the response to Claim 3, Article 16.1 does not confer a right of 
objection to the trademark owners. Therefore, the procedures laid down in Regulation 2081/92 with a 
view to organize the exercise of such right cannot be inconsistent with Article 16.1. 
 
                                                      
161 Australia's FWS, paras. 94-99.  WT/DS174/R/Add.2 
 Page B-85 
 
 
 341. In any event, Australia's allegati ons are incorrect as a matter of fact. 
 342. First, as explained above,
162 the Commission, or the Council, and not the Committee is "the 
ultimate decision-maker" under the Regulation.  
343. Second, Regulation 2081/92 entrusts to the authorities of the Member States the task of 
receiving and examining the objections because they are generally better placed to ascertain and assess the relevant facts. While Member States are not required to transmit the statements objections, 
their decisions are not discretionary and may be s ubject to judicial review under the national law of 
each Member State. 
 
344. Third, the authorities of other WTO Members enjoy complete discretion in order to decide whether or not to forward the objections to the EC Commission. Thus, Australia would be estopped 
from complaining that the refusal by the Australian au thorities to transmit a statement of objections to 
the EC Commission would infringe the trademark right s of its own nationals in the EC. The same 
would be true of any other WTO Member.    
 B. C
LAIM 23: BY REQUIRING THE CO -EXISTENCE OF A REGISTERED GEOGRAPHICAL INDICATION 
AND AN EARLIER TRADEMARK , ARTICLE  14(2)  ENCUMBERS UNJUSTIFIABLY THE USE OF THE 
TRADEMARK , CONTRARY TO ARTICLE  20 OF THE TRIPS  AGREEMENT  
345. Australia (but not the United States) claims that by requiring the co-existence of a an existing 
trademark and a later geographical indication, Article 14(2) of Regul ation 2081/92 "encumbers 
unjustifiably" the use of the trademark, thereb y violating Article 20 of the TRIPS Agreement. 163 
 346. Article 20 of the TRIPS provides that  
The use of a trademark in the course of trad e shall not be unjustifiably encumbered by 
special requirements, such as use with anothe r trademark, use in a special form or use 
in a manner detrimental to its capability to  distinguish the goods or services of one 
undertaking from those of other undertaki ngs. This will not preclude a requirement 
prescribing the use of the trademark iden tifying the undertaking producing the goods 
or services along with, but without linking it to, the trademark distinguishing the 
specific goods or services in question of that undertaking. 
347. Australia has misunderstood the purpose and, as result, also the scope of  Article 20. That 
provision is not concerned with the issue of exclusivity (i.e. who has the right to use a sign), which, as 
between trademarks, is dealt with exhaustively by Article 16. Instead, Article 20 addresses the distinct 
issue of which requirements may be imposed upon the trademark right holder with respect to the use 
of his own trademark (i.e, how to use a trademark"). 
 348. On Australia's interpretation Article 20 w ould overlap, and potentially conflict, with 
Article 16.  For example,  
• Article 16.1 allows the use of a later si milar trademark for similar goods, provided 
that it does not result in "likelihood of conf usion". Yet, on Australia's theory, the use 
of that trademark would still be proh ibited under Article 20 if it "encumbered 
unjustifiably" the use of the earlier trademark, for example by "diminishing its distinctiveness"; 
 
                                                     
 
162 See above Section II. H. 
163 Australia's FWS, paras. 108-112. WT/DS174/R/Add.2 
Page B-86  
 
 • Article 16.1 provides that the exclusivity of registered trademarks is without 
prejudice of existing prior rights. Yet, on Au stralia's  interpretation, the exercise of 
such prior rights could still be prohibited if it "encumbered unjustifiably" the use of a 
later trademark; 
 
• Article 16 allows the use of identical or similar signs for different goods, except as 
provided in Article 16.3. On Australia's in terpretation, however, such use could be 
prohibited by Article 20 whenever it "encum bers unjustifiably" the use of another 
trademark. 
 349. The three examples of "special requirements"  included in the first sentence confirm that 
Article 20 does not address the issue of exclusivity: 
 
• the first example ("use with another tradem ark") refers to the requirement that an 
undertaking uses, in addition to its own tr ademark, another trademark for the same 
goods, and not to the use of a trademark in coexistence with another trademark used 
by a different undertaking for its own goods.
  A typical example is the requirement to 
use a foreign trademark together with the trademark of a domestic producer.164 
 
• the second example ("use in a special from") is, by its owns terms, concerned 
exclusively with the form  in which the trademark may be used, rather than with the 
issue of who has the right to use it. It  concerns, for example, the requirements 
affecting the affixing of the trademark. 165 
 
• as regards the third example ("in a manner  detrimental to the capability to distinguish 
the goods or services, etc."), on which Australia places particular emphasis, the term "in a manner" confirms that the requirement must relate to the "way", "method" or "mode"
166 in which the trademark is used by each  trademark owner, rather than to the 
issue of exclusivity. 
 350. Article 14(2) of Regulation 208 1/192 limits the exclusive right of the trademark right holder 
to prevent the use of the trademark by others, by  providing for the co-existence of a geographical 
indication, but imposes no "requirement" with respect to how the trademark owner may use its own 
trademark. Since Article 14(2) imposes no requiremen ts falling within the scope of Article 20 of the 
TRIPS Agreement, it cannot be inc onsistent with that provision. 
 
351. In any event, as shown in the response to Claim 19, co-existence is  consistent with the 
relevant EC's obligations under the TRIPS Agreement and, therefore, would not be "unjustified".  
 C. C
LAIM 24: ARTICLE  14(1)  OF REGULATION 2081/92  IS INCONSISTENT WITH ARTICLE  24.5  OF 
THE TRIPS  AGREEMENT BECAUSE IT DOES NOT AFFORD THE RIGHT OF PRIORITY PROVIDED IN 
ARTICLE  4 OF THE PARIS CONVENTION  
352. Australia (but not the United States) claims th at Article 14(1) of Regulation 2081/92 violates 
Article 25.4 of the TRIPS Agreement because it does not afford the right of priority in respect of an 
                                                      
164 See Daniel Gervais, The TRIPS Agreement, Drafting History and Analysis  (Sweet and Maxwell, 
1998), p. 116. See also Eleanor.K. Meltzer, "TRIPS and Trademarks, or GATT got your tongue?" (1993)   83 
The Trademark Reporter,  pp. 18-37, p. 29.   
165 Daniel Gervais, op.cit ., p. 117. 
166 New Shorter Oxford English Dictionary, 1993, Vol. I, p. 1687.  WT/DS174/R/Add.2 
 Page B-87 
 
 
 application for registration of a trademark previ ously filed in another WTO Member provided in 
Article 4 of the Paris Convention (1967). 167 
 353. As explained in Section II,
168 the EC considers that this claim is outside the terms of reference 
because it is entirely dependent on a supposed violation of Article 4 of the Paris Convention (1967), 
which was not mentioned in Australia's panel request. 
 354. In any event, Australia's claim is insuffi ciently argued and difficult to understand. 
 355. Australia appears to be arguing that, in acco rdance with Article 4 of the Paris Convention 
(1967), an application for a trademark that was filed in Member X up to six months prior to one of the 
two dates mentioned in Article 24.5 of the TRIPS Agre ement would have the effect of bringing within 
the scope of the protection provided by Article 24.5 any subsequent a pplication made after those dates 
in Member Y. That interpretation, however, would be incorrect, beca use it relies on the legal 
consequences of Article 24.5 in order to establish that certain facts fall within the scope of that 
provision. In other words, Australia 's interpretation of Article 24.5 already anticipates the result of 
such interpretation.   356. Article 24.5 requires to afford the priority right  of Article 4 of the Paris Convention (1967) to 
those applications that are "grandfathered" by virtue  of that provision, i.e. to the applications filed 
before the date of entry into force of the WTO Ag reement (1 January 1996) or before the date of 
protection of the GI in its country of origin. But Article 4 of the Paris Convention (1967) cannot be 
applied in order to determine whether an app lication is "grandfathered" in accordance with 
Article 25.4. For that purpose, the only relevant da te is the actual date of filing in the Member 
applying the implementing measures. When that date is taken into account, Article 14(1) of 
Regulation 2081/1992 is fully consistent w ith Article 24.5 of the TRIPS Agreement.  
 
D. A
RTICLES 41.1,  41.2,  41.3,  41.4,  42, 43, 44.1,  45, 46, 48 AND 49 OF THE TRIPS  AGREEMENT  
1. General Considerations 
357. Australia and the United States claim that Re gulation 2081/92 is incons istent with numerous 
provisions of Part III of the TRIPS Agreement becau se it does not afford to trademark right holders 
the enforcement rights stipulated in those provisions. 
 
358. The EC considers that these claims are unf ounded because Part III of the TRIPS Agreement 
does not apply to Regulation 2081/92.  359. Regulation 2081/92 lays down an administra tive procedure for the acquisition of geographical 
indications via a system of registration. It does not purport to regulate the procedures for enforcing 
trademark rights, which are provided instead in th e trademark laws, and related civil and criminal 
procedural laws, of the EC and of its Member St ates. Those laws, which have been notified to the 
WTO, are not within the terms of reference of the Panel.  360. The TRIPS Agreement draws a clear distinc tion between, on the one hand, the procedures for 
the "enforcement" of intellectual property rights, wh ich are provided in Part III, and, on the other 
hand, the "procedures for the acquisition and ma intenance of intellectual rights and related inter 
partes  procedures", which are addressed in Part IV. The procedures provided in Regulation 2081/92 
for the registration of geographical indications at issue in this dispute fall clearly within the second 
category and are subject exclusively to Part IV, and not to Part III.  
                                                     
 
167 Australia's FWS, paras. 81-87. 
168 See above paras. 28-30.  WT/DS174/R/Add.2 
Page B-88  
 
  
361. The purpose of Part III is expressed in Article 41.1 which provides that 
 
Members shall ensure that enforcement pr ocedures as specified in this part are 
available under their law so as to permit effective action against any act of 
infringement of intellectual property rights covered by this Agreement, including 
expeditious remedies to prevent infri ngements and remedies which constitute a 
deterrent to further infringements. 
362. The granting of an intellectual property righ t in accordance with the domestic law of each 
Member is not an "infringement" and, therefore, is  not subject to Part III of the TRIPS Agreement. 
Further, the subsequent use of a validly granted intellectual property right in conformity with the 
domestic laws of a Member is also not an "infringement".  363. For the purposes of Part III, the existence of an "infringement" must be established with 
respect to the applicable domestic law implementi ng Part II of the TRIPS Agreement, and not in 
relation to Part II itself. In other words, an act whic h is consistent with a Member's domestic law, such 
as the use of a validly registered geographical indicat ion, is not an "infringement" for the purposes of 
Part III, even if the domestic law is inconsistent with Part II. Indeed, requiring Members to provide 
"enforcement" procedures against acts that are co nsistent with their ow n domestic laws, but are 
inconsistent with Part II, would be as much as requiring them to give direct effect to the WTO 
Agreement in their domestic legal order. 
 
364. In addition, applying the provisions of Pa rt III to the procedures for the acquisition of 
intellectual property rights, such as those regul ated in Regulation 2081/1992, would render redundant 
many of the provisions of Part IV and give rise to conflicts between Part III and Part IV. 
 
365. Moreover, it would have unacceptable resu lts for most Members, as illustrated by the 
complainants' claims. It would mean, for example, that intellectual property rights would have to be 
conferred always by a judicial body in accordance with judicial procedures, rather than by an administrative body in accordance with administrative  procedures, as is currently the case in most 
Members, including Australia and the United States.  The EC does not believe, for instance, that the 
complainants' own systems of registration of trad emarks, which are operated by an administrative 
body, would comply with the provisions of Part III. 
 
2. Claim 25: Regulation 2081/92 is inconsistent  with Article 41.1 of the TRIPS Agreement  
366. Both Australia and the United States claim that Regulation 2081/92 is  inconsistent with 
Article 41.1 of the TRIPS Agreement
169. 
 
367. Article 41.1 of the TRIPS Agreement is an introductory provision, which does not impose any 
obligation by itself. Australia appears to agree beca use it argues that the measure  is inconsistent with 
Article 41.1 "as a consequence of"170 the fact that it is inconsistent with Articles 41.2, 41.3, 42, 43, 44, 
45, 46, 48 and 49.  As explained in Section II, the EC considers that Articles 43, 44, 45, 46, 48 and 49 are outside the terms of reference of the Panel, b ecause they were not mentioned in Australia's panel 
request. Australia's claims under Articles 41.2,  41.3 and 42 will be addressed here below. 
 368. The United States submits no arguments in support of this claim.
171  
                                                      
169 Australia's FWS 145-148.  US FWS, para. 185. 
170 Australia's FWS, para. 148. 
171 US FWS, para. 185.  WT/DS174/R/Add.2 
 Page B-89 
 
 
 3. Claim 26: Regulation 2081/92 is inconsistent  with Article 41.2 of the TRIPS Agreement  
369. Both Australia and the United States claim that Regulation 2081/92 is  inconsistent with 
Article 41.2 of the TRIPS Agreement172 because 
 
• it does not make available to trademark ow ners "fair and equitable procedures" for 
objecting to the registration of geographical indications; 
 
• the objection procedures are "unnecessarily complicated" and "entail unwarranted 
delays".  
 370. For the reasons explained above, the EC consider s that Article 41.2, like the rest of Part III of 
the TRIPS Agreement, does not apply to the procedures for the acquisition of intellectual property 
rights, which are instead subject ex clusively to the provisions of Part IV. In the case of Article 41.2, 
this is made clear by Article 62.4 of the TRIPS Agreement, which provides that 
 
The procedures concerning the acquisition or maintenance of intellectual property 
rights and, where a Member's law provides for such procedures, administrative 
revocation and inter partes  procedures such as opposition, revocation and 
cancellation, shall be governed by the genera l principles set out in paragraphs 2 and 3 
of Article 41. 
371. The cross-reference to "the general  principles  set out in paragraphs 2 and 3 of Article 41" 
would have been superfluous if Ar ticle 41 could be applied, as such, to the procedures for the 
registration of an intellectual property right. 
 
372. Neither Australia nor the United States ha ve claimed in their panel requests that 
Regulation 2081/92 is inconsistent  with Article 62.4, which is, therefore, outside the terms of 
reference of the Panel.  
373. In any event, as shown below, the complain ants' allegations are unfounded as a matter of fact. 
 (a) The procedures provided in Regulation 2081/92 are neither inequitable nor unfair 
374. The accusation that a Member acts in an "unf air and inequitable" manner is a very serious 
one. One could expect that such an accusation w ould be made against another Member only after 
careful consideration and on the basis of indisputable evidence. 
 375. Yet, the United States does not even bother to provide argument, let alone evidence, in 
support of its claim under Article 41.2.
173 
 376. For its part, Australia alleges that the objection procedures provided for in 
Regulation 2081/92 are neither fair nor equitable because  
 
• objections must be lodged with an agency "that is likely  to have an interest in supporting 
and promoting the registration of EC-defined GIs";
174 
 
                                                      
172 Australia's FWS, paras. 126-136. US FWS, para. 186. 
173 US FWS, para. 186. 
174 Australia's FWS, para. 130. Emphasis added. WT/DS174/R/Add.2 
Page B-90  
 
 • objections must be considered by a Committee comprised of "delegates of the same EC 
Member States agencies which are likely  to have an interest in supporting and promoting 
the proposed registration of EC Member State geographic terms as defined GIs"
175 
 
• "trademark right holders not resident in the EC face the additional hurdle of not having a 
national representative in the Committee".176 
 
377. Australia concludes that "in such circumstances, the possibility of bias  in favour of both the 
proposed EC-defined GI and the interests of EC Member States cannot be seen to be excluded ."177 
 378. At the outset, the EC would submit that the me re fact that the "possibility of bias cannot be 
seen to be excluded" cannot be sufficient to estab lish a violation of Article 41.2. Instead, it would 
need to be shown that the procedures at issue ar e positively unfair and inequitable. In any event, 
Australia has not met even the very low standard which it has set forth itself. 
 379. To begin with, Australia's a llegations are fraught with factual errors. Australia  repeats, once 
again, the mistake of considering that the Committee is the decision-making body. Moreover, it is also 
incorrect to describe the members of the Committee as  "delegates" of the national agencies in charge 
of applying Regulation 2081/92.
178 The members of the Committee re present the Member States, and 
not specific agencies.   380. Even more crucially, Australia 's allegations of "possibility of bias" are not based on actual 
fact, but on mere speculations about the "likely" conduct of public agencies and their officials. Those 
speculations are baseless and, indeed, offensive. 
 381. Neither the agencies of the Member St ates responsible for the administration of 
Regulation 2081/92, nor the officials employed by  such agencies, are unde r any instructions to 
"promote" the registration of "their" geographical indi cations at the expense of the rights of trademark 
holders, whether they are EC nationals or foreigne rs. To the contrary, they are under a statutory duty 
to apply Regulation 2081/92 in an objective a nd unbiased manner. In the absence of compelling 
evidence, which Australia has not provided, it ca nnot be assumed that those agencies, or their 
officials, are "likely" to breach  systematically those duties. 
 
382. Surely, Australia would agree that Australia's own trademark office, and the officials of that 
agency, are not "likely" to be biased in favour of  registering trademarks requested by Australian 
nationals over the objections of EC's right holders of geographical indications. Australia would also 
agree that the fact that the EC or its Member St ates are not "represented" in the decision making 
bodies of Australia's trade mark office does not render  the procedures before that office "unfair" and 
"inequitable". Again, in the abse nce of any compelling evidence to the contrary, which Australia has 
not provided, it cannot be assumed that the agencies of  the EC Member States, and their officials, will 
behave differently from Australia's own agencies and officials.  (b) The procedures provided in Regulation 2081/92 are not unnecessarily complicated and do not 
entail unwarranted delays  
383. Again, the United States has not submitted any argument in support of this claim.
179 
 
                                                      
175 Ibid., para.131. Emphasis added. 
176 Ibid., para. 134.  
177 Ibid., para. 135. Emphasis added.  
178 Ibid., para. 131. 
179 US FWS,  para. 186.  WT/DS174/R/Add.2 
 Page B-91 
 
 
 384. The thrust of Australia's clai m is that the requirement to lodge the statement of objection with 
the authorities of the Member State or the WTO me mber of residence "adds unjustifiable complexity 
and delay" to the enforcement of trademark rights.180 
 385. Australia's complaint is unfounded. As explained, Regulation 2081/92 entrusts the 
examination of objections to the Member States because they are closer to the facts and better 
equipped to ascertain and assess them. Even if objections were lodged directly with the EC 
Commission, it would still be necessary for the EC Commission to request the assistance of the 
authorities of the Member States in order to verify the relevant facts. Thus, it is very doubtful that 
centralising the submission of objections at the Commission level would add simplicity or speed to 
the procedures.  
 386. The same is true as regards the statements of objections filed with another WTO Member, in 
particular when they relate to the registration of a geographical indication from that WTO Member. 
Moreover, each WTO Member has complete discretion in order to decide whether or not to transmit 
an objection to the EC Commission. If they wished , the Australian authorities could limit themselves 
to forward immediately to the EC Commission any objection that they receive. This can hardly be 
described as an "unnecessarily co mplicated" formality or as an "unwarranted delay". Once again, 
Australia cannot plead its own unwillingness to forw ard the statement, or its failure to do so 
expeditiously, in order to claim that this requi rement adds unjustified complexity or delay.  
 4. Claim 27: Regulation 2081/92 is inconsistent  with Article 41.3 of the TRIPS Agreement 
387. Australia (but not the United States) claims that Regulation 2081/92 is inconsistent with 
Article 41.3 of the TRIPS Agreement in that th e registration decisions are not "based only on 
evidence on which parties were offered the opportun ity to be heard". Specifically, Australia alleges 
that Regulation 2081/92 does not ensure that the Committee will consider the objections lodged with 
the Member States.
 181 
 388. Like the rest of Part III of the TRIPS Agreement, Article 41.3 does not apply to the 
procedures for the acquisition of intellectual property rights, which are instead subject to the provisions of Part IV. This is made clear, once agai n, by Article 62.4 of the TRIPS Agreement, which 
makes a cross-reference to the general  principles  stated in paragraph 3 of Article 41. As mentioned, 
Australia did not state in its panel request Article  62.4, which is, therefore, outside the terms of 
reference of the Panel.  389. In any event, Australia's factual allegations  under this heading are incorrect. (See above the 
responses to Claims 21 and 22) 
 
5. Claim 28: Regulation 2081/92 is inconsistent  with Article 41.4 of the TRIPS Agreement 
390. The United States (but not Australia) claims that  the measure is inconsistent with Article 41.4 
because "owners of registered trademarks trying to  enforce their Article 16.1 rights vis-à-vis a 
confusing GI or interested parties with GIs based  in other territories other than the EC" are not 
provided an opportunity for review by a judicial authority.
 182 
 
391. Again, the United States limits itself to assert this claim, but does not submit any argument in order to support it.  
                                                     
 
180 Australia's FWS, para. 138. 
181 Australia's FWS, paras. 141-144. 
182 US FWS, para. 187. WT/DS174/R/Add.2 
Page B-92  
 
 392. In any event, Article 41.4 of the TRIPS Agreement does not apply with respect to the 
procedures for the acquisition of intellectual property rights. As discussed below, Article 62.5 of the 
TRIPS Agreement provides that final administrative d ecisions in those procedures shall be subject to 
judicial review. The United States, however, has not mentioned this provision in its panel request. In 
any event, registration decisions under Regulation 2081/92 are subject to judicial review. 
 
6. Claim 29: Regulation 2081/92 is inconsistent with Article 42 of the TRIPS Agreement 
393. The complainants claim that Regulation 2081/ 92 is inconsistent with Article 42 because it 
does not provide to trademark right holders civil judicial procedures for the enforcement of their 
rights vis-à-vis the registration of geographical indications.
 183  
 
394. The valid registration of a geographical indication in accordance with Regulation 2081/92 
does not constitute an "infringement" of trademark ri ghts for purposes of Part III. Accordingly, there 
is no obligation under Article 42 to provide judicial procedures for "enforcing" those rights against the registration of a geographical indication.  
 
395. As explained, Regulation 2081/92 lays down an administrative procedure for the acquisition 
of geographical indication rights via a system of regi stration As such, it is subject to Part IV of the 
TRIPS Agreement, and not to Part III. Unlike Part I II, Part IV does not require to provide judicial 
procedures. In most countries, including the Unite d States and Australia, registration procedures are 
administrative in nature.  
 
396. While Part IV does not require to provide judi cial procedures, it requires that final decisions 
in administrative procedures must be subject to judicial review. Thus, Article 62.5 states that  
Final administrative decisions in any of the procedures referred to under paragraph 4 
shall be subject to review by a judicial or  quasi judicial authority. However, there 
shall be no obligation to provide an opportunity for such review of decisions in cases of unsuccessful opposition or administrative re vocation, provided that the grounds for 
such procedures can be the subject of invalidation. 
397. Consistent with Article 62.5, the fi nal decisions on registration reached under 
Regulation 2081/92 are subject to judicial review. Likewise, the decisions of the Member States 
authorities with regard to inter alia  objections may be subject to judicial review under their national 
laws. In any event, neither the United States nor Au stralia have stated in their panel requests any 
claim under Article 65.2, which is theref ore outside the terms of reference. 
 E. C
LAIM 30: REGULATION 2081/92  IS INCONSISTENT WITH ARTICLE  10BIS (1) AND 10TER (1) OF 
THE PARIS CONVENTION  
398. Australia (but not the United States) claims that Regulation 2081/92 is inconsistent with 
Article 10 bis (1) of the Paris Convention (1967)184 because "it does not provide a Community wide 
system of effective protection of trademarks from acts of unfair competition arising from the later registration of EC-defined GIs under the Regulation".
185 
 
399. This claim is insufficiently argued and difficu lt to understand.  Australia does not explain how 
the use of a registered geographical indication, which is otherwise consistent with the TRIPS 
                                                      
183 Australia's FWS,  paras. 119-125. US FWS, para. 187. 
184 Australia's FWS, paras. 113-118. 
185 Australia's FWS,  para. 114.  WT/DS174/R/Add.2 
 Page B-93 
 
 
 Agreement, and in particular with Articles 24.5 a nd 16, could constitute an act of unfair competition 
within the meaning of Article 10 bis (1). 
 400. In any event, the use of registered geogr aphical indications remains subject to the EC 
legislation on labelling and misleadi ng advertising, as well as to the laws of the EC Member States on 
unfair competition. That legislation is not w ithin the terms of reference of the Panel. 
 401. Australia suggests that the violation would ar ise from the fact that there is no Community 
wide system of protection.
186 However, there is no basis in Article 10 bis (1), or anywhere else in the 
Paris Convention (1967) for the proposition that th e protection against unfair competition must be 
provided at any given territorial level.187  
 402. Australia's claim under Article 10 ter (1)of the Paris Convention (1967)
188 is based on the 
same allegations as the claim under Article10 bis (1) and is equally unfou nded for the same reasons. 
 
F. CONSEQUENTIAL CLAIMS  
1. Claim 31: Regulation 2081/92 is inconsistent with Article 2.1 of the TRIPS Agreement 
403. Australia claims that, because Regulati on 2081/92 is inconsistent with Articles 10 bis (1) and 
10ter (1) of the Paris Convention (1967), it is also inconsistent with Article 2.1 of the TRIPS 
Agreement.189 
 
404. This claim is entirely dependent on the previous claims under Articles 10 bis (1) and 10 ter (1) 
of the Paris Convention. Both claims are unfounded and, as a consequence,  so is this claim.  
 
2. Claim 32: Regulation 2081/92 is inconsistent with Article 1.1 of the TRIPS Agreement 
405. Australia claims that because Regulation 2081/92 is inconsistent with Articles 2.1, 16.1, 20, 
24.5, 41.1, 41.2, 41.3 and/ or 42 of the TRIPS Agreem ent it is also inconsistent with Article 1.1 of the 
TRIPS Agreement. 190 
 406. The EC has shown that Australia's claims unde r those provisions are without merit. Therefore, 
Australia's claim under Article 1.1 is likewise unfounded.    3. Claim 33: The transitional national prot ection provided by the Member States is 
inconsistent with Articles 2.1, 16.1, 41.1 , 41.2, 41.3 and/or 42 of the TRIPS Agreement 
407. Australia (but not the United States) claims th at the transitional protection that Member States 
are entitled to provide under Article 5(5) of Regu lation 2081/92 pending a registration decision is 
inconsistent with Articles 2.1 (incorporating Articles 10 bis (1) and 10 ter (1) of the Paris Convention 
(1967)) 16.1, 41.1, 41.2, 41.3 and/or 42 of the TRIPS Agreement.
 191 
 
                                                      
186 Australia's FWS, para. 114. 
187 Australia is a federal state. Surely, Australia would agree that Article 10 bis (1) does not require it to 
change the constitutional allocation of powers between  the Commonwealth and the State and Territory 
Governments. 
188 Australia's FWS, para. 117. 
189 Australia's FWS, para. 151. 
190 Australia's FWS para. 152. 
191 Australia's FWS, paras. 149-150. WT/DS174/R/Add.2 
Page B-94  
 
 408. This claim is entirely dependent on the pr evious claims submitted by Australia under the 
above listed provisions. Since those claims are unfounded, so is this claim.  
VII. THE EC MEASURE IS CONSISTENT WITH THE OBLIGATION TO PROVIDE 
PROTECTION TO GEOGRAPHICAL INDICATIONS UNDER ARTICLE 22.2 OF 
THE TRIPS AGREEMENT 
409. Australia
192 and the United States193 have submitted very different claims under this heading. 
The EC will address them separately here below.   
1. Claim 34: Regulation 2081/92 is inconsistent  with Article 22.2 of the TRIPS Agreement 
410. Australia claims that
 194 
 
Regulation No. 2081/92 establishes a Comm unity-wide regime for the registration 
and protection of EC-defined GIs. Howeve r, the EC measure does not provide –as 
concerns those same EC-defined GIs - legal channels for interested parties to prevent 
on a Community-wide basis any use of those EC-defined GIs which would mislead 
the public as to the geographical origin of  a good or any use which would constitute 
an act of unfair competition within the meaning of Paris Article 10 bis.  
411. Once again, this claim is insufficiently argue d. Here below, the EC will provide a provisional 
answer based on its limited understanding of Australia's rather obscure arguments.  
 
412. First, the EC considers that Article 22.2 of  the TRIPS Agreement is concerned exclusively 
with the protection of geographical indications. It cannot be invoked by a trademark right holder in 
order to prevent the use a geographical indicati on which supposedly infringes its trademark right, 
which is what Australia appears to be suggesting.     
413. Second, Regulation 2081/92 only allows the u se of a geographical indication in connection 
with goods that originate in the geographical area designated by that geographical indication. The EC 
fails to see how the use of a validly registered geogr aphical indication, which is otherwise consistent 
with the TRIPS Agreement, could possibly mislead the public as to the geographical origin of the 
goods. In fact, the registration of the geographical indication seeks to avoid precisely that result.  
414. Third, the EC also fails to understand how  the registration or the use of a geographical 
indication consistently with the EC domestic laws , as well as with all other provisions of the TRIPS 
Agreement, including Articles 24.5 and 16, could ever  constitute an act of unfair competition within 
the meaning of Article 10 bis of the Paris Convention (1967). Australia has not explained it. In any 
event, the use of registered geographical indications  remains subject to the EC legislation on labelling 
and misleading advertising, as well as to the laws of the Member States on unfair competition. That 
legislation is not within the te rms of reference of the Panel. 
 415. Finally, Australia suggests that the violati on would arise from the fact that there is no 
Community-wide system of protection. However, there is no basis in Article 22.2, or anywhere else in 
the TRIPS Agreement, for the proposition that protecti on must be provided at any particular territorial 
level. 
 
                                                     
 
192 Australia's FWS, paras. 154-155. 
193 US FWS, paras. 171-183. 
194 Ibid., para. 155.  WT/DS174/R/Add.2 
 Page B-95 
 
 
 2. Claim 35: Regulation 2081/92 is inconsistent  with Article 1.1 of the TRIPS Agreement 
because it is inconsistent with Article 22.2 
416. Australia claims that, because Regulation 2 081/92 is inconsistent with Article 22.2 of the 
TRIPS Agreement, it is also in consistent with Article 1.1.195 
 
417. This claim is entirely consequential on Claim 21.  Since there is no violation of Article 22.2, 
there is also no violation of Article 1.1.  
3. Claim 36: Regulation 2081/92 is inconsistent with Article 22.2 TRIPS 
418. The United States claims that Regulation 2081/92  is inconsistent with Article 22.2 because it 
fails to provide to "interested parties" establis hed outside the EC the means to prevent the acts 
specified in that provision.
196 
 419. The United States cites the following reasons:   
• the registration of geographical indications is  subject to the conditions of equivalence 
and reciprocity; 
 
• the applications for registration of geogra phical indications must be made by the 
foreign governments; 
 
• the right to lodge an objection against a regi stration is subject to certain restrictions. 
 
420. As shown below, the reasons mentioned by the United States are either incorrect, as a matter 
of EC law, or irrelevant under WTO law. Theref ore, Regulation 2081/92 implements adequately the 
EC's obligations under Article 22.2 also with r espect to the "interested parties" of other WTO 
Members.  421. In any event, the EC recalls that Regulati on 2081/92 is not the only means made available by 
the EC and its Member States to the "interested parties" of other WTO Members in order to prevent 
the acts mentioned in Article 22.2. Therefore, even  assuming that the US arguments with respect to 
Article 2081/92 were correct, the EC would still comp ly with its obligations  under Article 22.2. 
 (a) Regulation 2081/92 provides to interested parties of other WTO Members the means to 
prevent the acts mentioned in Article 22.2 
(i) Reciprocity and equivalence conditions 
422. In support of its claim, the United States h as claimed that the registration of geographical 
indications is subject to conditions  of "reciprocity and equivalence". 
 423. As the EC has already stated before,
197 this claim is factually not correct. Article 12(1), to 
which the United States has referred, is not applic able to WTO Members. Accordingly, the United 
States' claim under Article 22.2 TRIPS is equally unfounded.  
                                                     
 
195 Australia's FWS, para. 156. 
196 US FWS, paras. 171-183. 
197 See above paras. 62-69. WT/DS174/R/Add.2 
Page B-96  
 
 (ii) The requirement that the application mu st be transmitted by the Government 
424. The United States has also refe rred to the fact that the a pplication for registration of a 
geographical indication must be transmitted by the g overnment of the country in which the relevant 
area is located.  
425. As the EC has already set out, this requireme nt is a modality of the registration process which 
equally applies to applications from Member Stat es and from third countries, i.e. concerns the 
procedure for the acquisition of an intellectual property right. According to Article 62.1 TRIPS, 
Members may require, as a condition of the acquisiti on or maintenance of intellectual property rights 
provided for under Sections 2 through 6 of Part  II, compliance with reasonable procedures and 
formalities. 
 426. The United States has not shown that the requirement of transmission by the third country government is an unreasonable procedural requirement . In any event, such a claim would be a claim 
under Article 62.1 TRIPS. Since the United States h as not referred to this provision in its Panel 
request, such a claim would be outside the Panel's terms of reference. 
 
(iii) The right of objection 
427. As explained above in response to Claim 21, the EC considers that the right to formulate 
objections to the registration of another intellectual property right is not inherent in the exclusivity 
rights conferred to trademark rights holders by Article  16.1. For the same reasons, the EC submits that 
Article 22.2 does not confer to "interested parties" a right to object to the registration of a 
geographical indication under Regulation 2081/92.   428. In any event, the US arguments are unfounded.  
429. First, the exercise of the rights conferred by Article 22.2, like that of other intellectual 
property rights, can be made subject to comp liance with reasonable procedures and formalities.
198 The 
requirement that statements of objections must be channelled through the authorities of other WTO 
Members is equivalent to the re quirement imposed on EC residents.  It is neither excessive nor 
unreasonable.   Indeed, the authorities of other WTO Members enjoy complete discretion to decided whether or not to transmit an objection. If the US authorities wished, they could limit themselves to 
forward immediately any objection that they recei ve. Furthermore, the United States would be 
estopped from pleading that, because of its own willingness to forward a statement of objections to the EC Commission, US nationals are depriv ed from the means of protection required by 
Article 22.2.
199 
 
430. Second, as explained in the factual part, the United States has misread Article 12d of 
Regulation 2081/92.200 The requirement that the country must have been recognized under 
Article 12(3) does not apply to WTO Members.    431. Third, Articles 12b (2) and 12d (1) of Regulati on 2081/92 require a "legitimate interest" as a 
condition for objecting to the registration of a geogra phical indication. However, this term does not, in 
accordance with its ordinary meaning, require th at the person concerned must have an economic 
interest "in the EC" in the sense that it must be  "established" or "do business" within the EC.
201  
 
                                                      
198 Cf. Articles 62.1 and 41.2 of the TRIPS Agreement. 
199 US FWS, para. 179. 
200 US FWS, para. 180. 
201 US FWS, para. 181.  WT/DS174/R/Add.2 
 Page B-97 
 
 
 432. Fourth, a name which is misleading as to the or igin of the product would fail to comply with 
the requirements of Article 2 (the firs t ground of objection under Article 7(4)).202 The EC fails to see 
what "acts of unfair competition", in addition to those already covered by the existing grounds of 
objection, could arise from the  valid registration of a geographical indication under Regulation 2081/92.
203 The United States has specified none. 
 
(b) The EC and its Member States provides to interested parties of other WTO Members other 
means to prevent the acts mentioned in Article 22.2 
433. Regulation 2081/92 is not the only means made available by the EC and its Member States to 
interested parties established both in the EC and in  other WTO Members in order to prevent the acts 
mentioned in Article 22.2. 
 434. Specifically, additional means of protection are provided in:   
• Directive 79/112 on the labelling, presen tation and advertising of foodstuffs
204 and 
implementing legislation of the Member States;  
 
• Directive 84/450 on misleading advertising205 and implementing legislation of the 
Member States;  
 
• the Trademarks Directive and implementing legislation of the Member States; 
 
• the Community Trademark Regulation; 
 
• unfair competition laws of the Member States.  
 435. The United States is aware of the above measu res, which were specified in the responses 
provided by the EC and its Member States in the context of the review under Article 24.2 of the 
TRIPS Agreement
206 and have been notified to the WTO.   
 436. The means of protection provided by the above measures are sufficient to   implement the EC's 
obligation under Article 22.2. In any event, these m easures are outside the terms of reference of the 
Panel.  
VIII.  REGULATION 2081/92 IS CONSISTENT WI TH OBLIGATIONS UNDER THE TBT 
AGREEMENT 
437. Australia (but not the United States) has raised two claims under the TBT Agreement: 
 
• that Article 12(2) of Regulation 2081/92 is incompatible with Article 2.1 of the TBT 
Agreement (claim 37);
207 
                                                      
202 US FWS, para. 182. 
203 Ibid. 
204 Directive 2000/13/EC of the European Parliament and of the Council, of 20 March 2000, on the 
approximation of the laws of the member States relating to the labelling, presentation and advertising of 
foodstuffs, OJ (2000) L 109/29. 
205 Council Directive 84/450/EEC of 10 September 1984 relating to the approximation of the laws, 
regulations and administrative provisions of the Member  States concerning misleadin g advertising, OJ (1984) 
L 250/17. 
206 IP/C/W/117/Add. 10, 26 March 1999. 
207 Australia's FWS, para. 234 et seq. WT/DS174/R/Add.2 
Page B-98  
 
  
• that Articles 4 and 10 of Regulation 2081/92 are incompatible with Article 2.2 of the 
TBT Agreement (claim 38).
208 
 438. Hereafter, the EC will first show that th e provisions of Regulation 2081/92 referred to by 
Australia cannot be regarded as technical regulations  within the meaning of Articles 2.1 and 2.2 TBT 
Agreement. Subsequently, the EC will show that in any event, Australia's claims under Article 2.1 and 
2.2 TBT Agreement are unfounded.   A. R
EGULATION 2081/92  IS NOT A TECHNICAL REGULATION  
439. Australia has argued that Regulation 2081/92 is  in part a technical regulation within the 
meaning of Annex 1 to the TBT Agreement.209 In this respect, it has referred on the one hand to 
Article 12(2) of Regulation 2081/92, and on the other hand to Article 4, in particular 4 (2) (g), and 10 
of Regulation 2081/92.210  As the EC will show, none of these provisions constitutes a technical 
regulation within the meaning of the TBT Agreement.  1. General 
440. Articles 2.1 and 2.2 of the TBT Agreement impose obligations on WTO Members with 
respect to "technical regulations". As the Appellate Body has explained in EC – Asbestos , whether the 
measure is a technical regulation is therefore a threshold issue which determines whether the 
obligations contained in Article 2 TBT Agreement are applicable.
211 
 
441. Point 1 of Annex 1 to the TBT Agreement defines a technical regulation as follows: 
 
Document which lays down product charact eristics or their related processes and 
production methods, including the applicable  administrative provisions, with which 
compliance is mandatory.  It may also include  or deal exclusively with terminology, 
symbols, packaging, marking or labelling requirements as they apply to a product, 
process or production method. 
442. As the Appellate Body has stated in EC – Sardines , there are three criteria which must be 
fulfilled cumulatively in order for a measure to be considered a technical regulation:212 
 
We interpreted this definition in  EC – Asbestos .  In doing so, we set out  three 
criteria   that a document must meet to fall within the definition of "technical 
regulation" in the  TBT Agreement .  First ,  the document must apply to an identifiable 
product or group of products.  The  identifiable   product or group of products need 
not, however, be expressly  identified   in the document.  Second ,  the document must 
lay down one or more characteristics of the product.  These product characteristics 
may be intrinsic, or they may be related to the product.  They may be prescribed or 
imposed in either a positive or a negative form.  Third ,  compliance with the product 
characteristics must be mandatory.  As we stressed in  EC – Asbestos ,  these three 
criteria are derived from the wording of the definition in Annex 1.1. 
                                                      
208 Australia's FWS, para. 249 et seq. 
209 Australia's FWS, para. 209 et seq. 
210 Australia's FWS, paras. 219–221. 
211 Appellate Body Report, EC – Asbestos , para. 59 ; similarly Appellate Body Report, EC – Sardines , 
para. 175. 
212 Appellate Body Report, EC – Sardines , para. 176.  WT/DS174/R/Add.2 
 Page B-99 
 
 
 2. Article 12(2) of Regulation 2081/92 is not a technical regulation 
443. Contrary to the view of Australia, Article  12(2) of Regulation 2081/92 is not a technical 
regulation within the meaning of the TBT Agreement.  (a) Article 12(2) does not apply to identifiable products 
444. First of all, Article 12(2) of Regulation 2081/92 does not apply to identifiable products. 
 445. Australia has argued that Regulation 2081/92 applies to agricultural products and foodstuffs, 
and that these are identifiable products.
213 However, the EC would like to recall that the requirement 
to indicate the country of origin contained in th e second subparagraph of Article 12(2) applies only to 
the names in the situation referred to in  the first subparagraph of Article 12(2).214  
 446. Accordingly, the requirement of Article 12(2)  does not apply to all agricultural products and 
foodstuffs for which a registration is obtaine d under Regulation 2081/92, but only to cases of 
homonymous protected names from the EC and a third country. Moreover, as the EC has also 
explained, the requirement in Article 12(2) can apply both to geographical indications from a third 
country or from the EC, depending on which name has been protected earlier.
215 
 447. The Regulation itself does not allow to identify the products which might be affected by this 
requirement. Accordingly, Article 12(2) does not apply to identifiable products. 
 
(b) Article 12(2) does not lay down product characteristics 
448. Second, Article 12(2) does not lay down produc t characteristics. Aust ralia has argued that 
Article 12(2) "sets out a specific labelling requir ement" falling within the meaning of a technical 
regulation as defined in Annex 1 to the TBT Agreement.
216 
 
449. Australia overlooks that Article 12(2) does not  contain a specific labelling requirement for 
any specific product. Article 12(2) sets out me rely the conditions under which a geographical 
indication will be registered in a situation where there are homonyms from the EC and a third country. 
The requirement to indicate the country of origin  will be a condition for the registration of the 
geographical indication for which protection is sought later. 
 
450. However, it is not Article 12(2) TBT Agre ement itself which imposes a labelling requirement. 
The application for the registration of any geographical indication, whether from the EC or a third country, must be accompanied by a product specifica tion. In accordance with Article 4 (2) (h) of 
Regulation 2081/92, the product specification shall cont ain the specific labelling details relating to the 
geographical indication. In the situation envisaged by Article 12(2), the requirement to indicate the 
country of origin will be among the labelling deta ils which must be indicated in the product 
specification.   451. Moreover, it must be noted that the definition of "technical regulation" in Annex 1 to the TBT 
Agreement encompasses labelling requirements only "as they apply to a product, process or 
production method". In the present case, the labelli ng requirement does not relate to a product, 
                                                     
 
213 Australia's FWS, para. 231. 
214 Above para. 85 et seq. 
215 Above, para. 88. 
216 Australia's FWS, para. 220. WT/DS174/R/Add.2 
Page B-100  
 
 process, or its production method, but merely to its  geographic origin. As the EC has already set 
out,
217 this question of origin marking is covered by the special disciplines of Article IX GATT. 
 452. Accordingly, Article 12(2) does not lay down product characteristics within the meaning of the definition of a technical regulation. 
 
(c) Article 12(2) of Regulation 2081/92 is not mandatory 
453. Finally, Article 12(2) does not impose a re quirement with which compliance is mandatory. 
 454. Regulation 2081/92 establishes a system for the registration and prot ection of geographical 
indications. The possibility to apply for registration of a geographical indication is a right, not an 
obligation. In particular, regist ration under Regulation 2081/92 is not  a precondition for the marketing 
of products.  455. Article 4(1) of Regulation 2081/92 provides that in order to be eligible to use a geographical 
indication, a product "must comply with a specificati on". However, it is important to note that this 
compliance refers only to the specifications in  Article 4(2), not to the Regulation itself. 
 456. Similarly, Article 12(2) is a condition for th e registration of a geographical indication. Since 
the registration process is voluntary, compliance with  Article 12(2) is not a mandatory condition for 
the placing of products on the market. 
 
457. For all the reasons set out  above, Article 12(2) of Regul ation 2081/92 is not a technical 
regulation within the meaning of the TBT Agreement.  
3. Articles 4 and 10 of Regulation 2081/92 are not a technical regulation 
458. Contrary to the view of Australia, Articles 4 and 10 of Regulation 2081/92 are not a technical 
regulation within the meaning of the TBT Agreement.  (a) Articles 4 and 10 do not lay down product characteristics 
459. First of all, Article 4 and 10 of Regulati on 2081/92 do not lay down product characteristics. 
 
460. Article 4(g), to which Australia has referre d specifically, provides merely that the product 
specification shall include the details of the in spection procedures provided for in Article 10. 
Article 10 provides the basic criteria with whic h such inspection structures must comply. These 
provisions cannot be regarded as laying down product characteristics.   
461. First, Article 10(1) defines that the functi on of inspection structures is "to ensure that 
agricultural products and foodstuffs bearing a protect ed name meet the requirements laid down in the 
specifications". Accordingly, the purpose of Article 4( g) in conjunction with Article 10 is not to lay 
down product characteristics, but to ensure conformity with the product specification.  462. However, the TBT Agreement makes a clea r distinction between measures laying down
 
product characteristics, and measures ensuring conformity  with technical regulations. Articles 2 to 4 
of the TBT Agreement deal with technical regulations and standards , whereas Articles 5 to 9 of the 
TBT Agreement are concerned with the assessment of conformity  with technical regulations and 
standards. Point 3 of Annex 1 to the TBT Agreement defines a conformity assessment procedure as follows: 
                                                     
 
217 Above 213.  WT/DS174/R/Add.2 
 Page B-101 
 
 
  
Any procedure used, directly or indirectly, to determine that relevant requirements in 
technical regulations or standards are fulfilled. 
463. Even if the product specification were to be considered a technical regulation, the inspection 
structure ensuring conformity with the specification would not be a technical regulation, but a 
conformity assessment procedure. Accordingly, Aust ralia's claim regarding the inspection procedure 
does not concern a technical regulation, and accordingly does not fall under Article 2 TBT Agreement. Rather, Australia's claim would appear to  fall, depending on the nature of the conformity 
assessment body involved, under Articles 5 to 9 of th e TBT Agreement. However, since Australia did 
not refer to these provisions in its Panel request, any such claim would be outside the terms of 
reference of the present Panel. 
 464. Second, Article 4 of Regulation 2081/92 does not lay down product characteristics.  Article 4(2) simply sets out the requirements with which a product specification must comply in order 
to permit the registration of a geographical indication. Article 4 (2) does not itself set out the product 
characteristics for specific products; rather, these ch aracteristics are contained in the application for 
registration of a geographical indication in acco rdance with Article 5 (3) of the Regulation. 
 465. Moreover, it is not exceptional that the defi nition of product characteristics is required as a 
condition for the acquisition of certain intellectual property rights. In particular, the system of 
certification marks which used by certain countries requires that products bearing the mark comply 
with certain product characteristics.
218 However, it does not appear that such trade mark laws have so 
far been considered as falling under the TBT Agreement.  466. Accordingly, Article 4 in conjunction with  Article 10 of Regulation 2081/92 cannot be 
regarded as laying down product characteristics. 
 
(b) Articles 4 and 10 are not mandatory 
467. As the EC has already explained, Regulati on 2081/92 establishes a system for the registration 
and protection of geographical indications which is voluntary. The requirement that inspection 
structures must exist is a necessary requirement for the registration of geographical indications. However, this registration is not a preconditio n for the placing of products on the market.  
 
468. For these reasons, Articles 4 and 10 of Re gulation 2081/92 are not a technical regulation 
within the meaning of the TBT Agreement.  B. C
LAIM 37: ARTICLE  12(2)  OF REGULATION 2081/92  IS INCOMPATIBLE WITH ARTICLE  2.1 OF 
THE TBT  AGREEMENT  
469. Australia has claimed that Article 12(2) of Regulation 2081/92 is incompatible with 
Article 2.1 of the TBT Agreement.219 As the EC has already explained, Article 12(2) of the Regulation 
is not a technical regulation, and Article 2. 2 TBT Agreement is therefore not applicable. 
 470. Alternatively, the EC considers that Article 12( 2) is fully compatible with Article 2.1 of the 
TBT Agreement. In this respect, the EC can also re fer to the response the EC has already given to the 
United States' claims 3 and 14, regarding Article  12(2) with respect to the national treatment 
provisions of the GATT and the TRIPS.  
                                                     
 
218 Cf. e.g. US Trademark Act, 15 US § 1127 (Exhibit EC-6). 
219 Australia's FWS, para. 234 et seq. WT/DS174/R/Add.2 
Page B-102  
 
 1. General 
471. Article 2.1 TBT Agreement c ontains a national treatment provision applicable to goods in 
respect of technical regulations. The provision is drafted as follows.  
Members shall ensure that in respect of technical regulations, products imported from 
the territory of any Member shall be acco rded treatment no less favourable than that 
accorded to like products of national origin  and to like products originating in any 
other country. 
472. There is so far no WTO jurisprudence on this provision. For the reasons set out below, the EC 
does not consider it necessary to define, in the present context, the meaning of each of the elements of 
Article 2.1 TBT Agreement. 
 473. However, the EC would also like to recall that  each provision of a covered agreement must be 
interpreted within the specific cont ext of that agreement. For this reason, the EC does not agree with 
Australia that the jurisprudence concerning Article III GATT can simply be transposed to Article 2.1 
TBT Agreement, for instance with respect to the likeness of products.
220 
 474. Such an approach would overlook that there are important structural differences between the GATT and the TBT Agreement. In particular, ther e is no provision corresponding to Article XX of 
the GATT in the TBT Agreement. These structural differences between the two agreements must be 
taken into account when interpreting the re quirements of Article 2.1 TBT Agreement. 
 
2. Article 12(2) of Regulation 2081/92 does not apply to all geographical indications, but 
only to homonyms 
475. As the EC has already set out, Article 12( 2) merely sets out the conditions under which a 
geographical indication will be registered in a situ ation where there are homonyms from the EC and a 
third country. The requirement to indicate the count ry of origin will be a condition for the registration 
of the geographical indication for which protection is sought later.
221 
 476. Accordingly, Article 12(2) does not treat fore ign and EC geographical indications differently; 
on the contrary, it treats them exactly alike. Accordingly, there is no violation of the national treatment obligation in Article 2.1 TBT Agreement. 
 
3. The requirement to indicate the country of origin for homonymous geographical 
indications from the EC and third count ries does not constitute less favourable 
treatment 
477. Australia has argued that a violation of Article 2.1 exists to the extent that a requirement to 
indicate the country of origin does not exist in the case of two homonyms from the EC.
222 
 478. This claim is equally unfounded. First of all,  such a difference of treatment would also affect 
EC geographical indications, which are equally covere d by Article 12(2), and therefore not be an issue 
of national treatment. In addition, the relevant point  of comparison in this case would be the treatment 
of two homonyms within Australia; however, th is is not a question which falls within the 
responsibility of the EC. 
 
                                                     
 
220 Australia's FWS, para. 226. 
221 Above para. 88. 
222 Australia's FWS, para. 235.  WT/DS174/R/Add.2 
 Page B-103 
 
 
 479. Moreover, Article 6(6) of Re gulation 2081/92 requires "a clear distinction in practice" also 
where conflicts between homonyms arise within th e EC. As the EC has explained, where the two 
homonyms are from different Member States, this may in practice require the indication of the country of origin.
223 The only reason why the last indent of Ar ticle 6 (6) does not explicitly require the 
indication of the country of origin is that this provision deals with a wide r set of conflicts than 
Article 12(2). In particular, Article 6(6) also a pplies to conflicts between homonyms from the same 
EC Member State.  In such a situation, the indication of the country of origin would not be a 
meaningful way of achieving the necessary "clear distinction".  480. Accordingly, Article 12(2) of Regulation 2 081/92 is compatible with Article 12(1) TBT 
Agreement. 
 
4. National treatment obligations do not appl y to requirements to mark the country of 
origin 
481. Finally, it must be recalled that marks of orig in are specifically dealt with in Article IX:1 of 
the GATT, which excludes the applicability of th e national treatment obligation under Article III:4 
GATT.
224 Should Article 12(2) of Regulation 2081/92 be considered as a technical regulation, then 
this should not have the effect of rendering th e specific provision of Article IX:1 GATT useless. 
Accordingly, in this case, the national treatment obligation contained in Article 2.1 TBT Agreement 
could not apply to origin marking requirements.  
482. In conclusion, Article 12(2) of Regulation 2081/92 is not inco mpatible with Article 2.1 TBT 
Agreement.  C. C
LAIM 38: ARTICLES 4, 10, AND 12 (1) OF REGULATION 2081/92  ARE INCOMPATIBLE WITH 
ARTICLE  2.2 OF THE TBT  AGREEMENT  
483. Australia has claimed that Articles 4, 10, a nd 12(1) of Regulation 2081/92 are incompatible 
with Article 2.2 of the TBT Agreement.225 Article 2.2 is drafted as follows: 
 
Members shall ensure that technical regula tions are not prepared, adopted or applied 
with a view to or with the effect of creating unnecessary obstacles to international trade.  For this purpose, technical regulations  shall not be more trade-restrictive than 
necessary to fulfil a legitimate objective, taking account of the risks non-fulfilment 
would create.  Such legitimate objectives are, inter alia:   national security 
requirements;  the prevention of deceptive pr actices;  protection of human health or 
safety, animal or plant life or health, or the environment.  In assessing such risks, 
relevant elements of consideration are, inter alia:   available scientific and technical 
information, related processing technol ogy or intended end-uses of products. 
484. Australia has explicitly recognised that Regulation 2081/92 pursues a legitimate objective, 
and is capable of fulfilling its legitimate objective.
226 However, Australia argues that Article 4, 10, and 
12(1) of Regulation 2081/92 read together requi re that another WTO Member have in place 
"inspection arrangements equivalent to  those laid down" in the Regulation, and that this is more trade-
restrictive than necessary to fu lfil the legitimate objective. 
 
                                                      
223 Above para. 89. 
224 Above para. 213. 
225 Australia's FWS, para. 249 et seq. 
226 Australia's FWS, paras. 247–248.  WT/DS174/R/Add.2 
Page B-104  
 
 485. As the EC has already explained, the provision of Regulation 2081/92 regarding inspection 
structures do no constitute a technical regulation, a nd therefore do not fall under Article 2.2 of the 
TBT Agreement. In any case, the EC considers that  the requirements regarding inspection structures 
are not more trade-restrictive than n ecessary, and this for the following reasons: 
 
• the existence of inspection structures is onl y required with respect to the specific 
product for which protection is sought; 
 
• the Regulation does not determine the speci fic design of the inspection structures; 
 
• the existence of inspection structures is necessary to achieve th e legitimate objectives 
of Regulation 2081/92. 
 1. The existence of inspection structures is only required with respect to the specific 
product for which protection is sought 
486. In support of its claim, Australia has referre d also to Article 12(1) of Regulation 2081/92. 
However, as the EC has explained, Article 12(1) is not applicable to WTO Members.
227 
 
487. Accordingly, the registration of a geogra phical indication from another WTO country does 
not require the existence of equivalent inspection st ructures for all products in that country. Rather, 
Article 12a, 10 and 4(2)(g) require the existence of equivalent inspection structures only with respect 
to the specific  product for which protection is sought. 
 2. The Regulation does not determine the specific design of the inspection structures 
488. Australia has argued that Article 10(1) of Regulation 2081/92 sets out the "detailed 
requirements" for the inspection structures, and cl aimed that the Regulation "provides no leeway for 
regard to be had to the particular circumstan ces or the existing arrangements of another WTO 
Member".
228 Similarly, Australia has argued that th e Regulation imposes an "EC model", and rules 
out the acceptability of other ty pes of inspection mechanisms.229 
 
489. These allegations are wrong. As the EC has e xplained, Regulation 2081/92,  and in particular 
Article 10 thereof, provides considerable flex ibility as to the specific design of inspection 
structures.230 Article 10 limits itself to setting out the b asic functions and principles applicable to 
inspection bodies, without regulating their design in  detail. Moreover, Articles 10(2) specifically 
allows a choice between public and private elements in the design of the inspection bodies. Finally, 
for bodies outside the EC, Article 10 does not mandate compliance with EC standards, but also allows 
compliance with equivalent international standards.  490. Accordingly, Australia's allegation that Re gulation 2081/92 "leaves no leeway" for the design 
of inspection structures is unsupported by fact. Indeed, Australia does not explain what specific 
problems it has with the principles and objectives set out in Article 10 of Regulation 2081/92. 
Moreover, it does not give any example for "other types of inspection mechanisms" which would be 
excluded by Regulation 2081/92.  491. Accordingly, Australia fails to show that th e requirements relating to inspection structures are 
more trade-restrictive than necessary. 
                                                     
 
227 Above, para. 62. 
228 Australia's FWS, paras. 249–250. 
229 Australia's FWS, para. 252. 
230 Above para. 50 et seq.  WT/DS174/R/Add.2 
 Page B-105 
 
 
  
3. The existence of inspection structures is necessa ry to achieve the legitimate objectives of 
Regulation 2081/92 
492. Indeed, it appears from Australia's submission th at its real concern is not with the specific 
requirements for inspection structures set out in Regu lation 2081/92, but rather that it considers that 
no inspection structures at all should be required.231 
 493. However, this argument of Australia mu st be rejected. The le gitimate objective of 
Regulation 2081/92 is the protection of geographical  indications. Geographical indications within the 
meaning of Article 22.1 TRIPS relate to goods th at have "a given quality, reputation or other 
characteristic" essentially attributable to their geographical origin. 
 494. The objective of the inspection procedures for eseen in Regulation 2081/92 is to ensure that 
products using a protected geographical indication do comply with the product specifications, and 
therefore have the "quality, reputation or other characteristic" which justifies this protection. 
 
495. The existence of such inspection procedures is beneficial both to consumers and to producers. 
Through the existence of inspection regimes, cons umers have a higher degree of assurance that a 
product using a specific geographic indication will indeed  comply with their expectations. This in turn 
will increase the value of the geographical indi cation, and thereby benefit the producers which 
produce in accordance with the product specifications. 
 
496. The EC notes that as regard s certification marks, the United States has also recognised that 
some form of control of the proper use of the name  may be necessary, and that this cannot be simply 
left to the user of the mark:
232 
 
When a geographic term is used as a certification mark, two elements are of basic 
concern: first, preserving the freedom of all persons in the region to use the term and, 
second, preventing abuses or illegal uses of the mark which would be detrimental to 
all those entitled to use the mark. Normally a private individual is not in the best 
position to fulfill these objectives satisfactorily. The government of a region would be 
the logical authority to control the use of  the name of the region.  The government, 
either directly or through a body to which it has given authority, would have power to 
preserve the right of all persons and to prevent abuse or illegal use of the mark. 
 
497. Australia has argued that inspection structures might not be necessary where there is only one 
producer, for instance where there is only one occu pant of the geographical area where the good can 
be produced.233 The EC does not agree with this argument. Even where there is only one producer, the 
expectations of consumers should still be protected. In fact, a monop olistic situation might require 
inspections even more strongly then where several producers produce a good protected by a 
geographical indication.  498. Australia has also argued that other systems of protection of geographical indications might 
achieve the same objective, and has referred in partic ular to the application of unfair competition law. 
The EC does not consider this convincing. The EC does not contest that Members are free to 
implement Article 22 TRIPS through different system s of protection. This follows explicitly from 
                                                     
 
231 Australia's FWS, para. 255 et seq. 
232 IP/C/W/117/Add.3, p. 10, 1 December 1998 (emphasis added). 
233 Australia's FWS, para. 254. WT/DS174/R/Add.2 
Page B-106  
 
 Article 1.1 TRIPS, according to which Members sha ll be free to determine th e appropriate method of 
implementing the provisions of the Agreement within their own legal system.  499. However, Article 1.1 TRIPS also provides th at Members may implement in their law more 
extensive protection than is required by the TRIPS,  provided that such protection does not contravene 
the provisions of the TRIPS. By establishing a sp ecific system for the protection of geographical 
indications, the EC has established a system which grants more extensive protection, in respect of 
geographical indications, both to consumers and pr oducers. This discretion left to the EC under 
Article 1.1 TRIPS cannot be limited on th e basis of Article 2.2 TBT Agreement. 
 
500. The requirements regarding inspection structure are an indispensable part of the EC system 
for the protection of geographical indications. It is therefore necessary to  achieve the legitimate 
objectives of Regulation 2081/92.  501. Accordingly, Regulation 2081/92 is fully compatible with Article 2.2 TBT Agreement. 
 
IX. CLAIM 39, 40: THE EC MEASURE IS COMPATIBLE WITH ARTICLE 65.1 TRIPS 
AND ARTICLE XVI:4 WTO 
502. The United States has claimed that the EC h as not fulfilled its obligations under Article 65.1 
TRIPS.
234 Similarly, Australia has claimed that the EC has not complied with its obligations under 
Article XVI:4 WTO.235 
 
503. Both claims are dependent on substantive claims discussed above. Since these claims are 
unfounded, the consequential claims under Ar ticle 65.1 TRIPS and XVI:4 WTO are equally 
unfounded.  X. CONCLUSION 
504. For the reasons set out in this submission, the EC requests the Panel: 
 
• to find that the claims and the measures specified in Section II are outside its terms of 
reference; 
 
• to reject all the claims within its terms of reference. 
                                                     
 
234 US FWS, para. 190. 
235 Australia's FWS, para. 267.  WT/DS174/R/Add.2 
 Page B-107 
 
 
 ANNEX B-3 
 
ORAL STATEMENT OF THE EUROPEAN COMMUNITIES 
FIRST SUBSTANTIVE MEETING 
 
(23 June 2004) 
  Mr Chairman, distinguished Members of the Panel,  
1. The European Communities (the  "EC") welcomes this opportunity to submit its views in this 
dispute. The EC has provided a comprehensive respon se to the complainants' claims in its first written 
submission. In this statement we will limit our selves to outline briefly our main arguments. 
 2. I will first recall a number of objections raised  by the EC in connecti on with the coverage of 
the terms of reference of the Panel. I will then address the complainants' claims that 
Regulation 2081/92 diminishes the legal protection of  trademarks, contrary to Articles 16, 20, 24.5 
and several provisions of Part III of the TRIPS Agreem ent. I will then turn to the complainants' claims 
that the EC measure is inconsistent with the obligation to protect geographical indications under 
Article 22.2 of the TRIPS Agreement.   
3. Following that, my colleague, Mr Martenczuk,  will discuss the claim that Regulation 2081/92 
is inconsistent with the national treatment oblig ations under the GATT and the TRIPS Agreement. He 
will then respond to the US claims that Regulati on 2081/92 is inconsistent with the obligation to 
provide most-favoured nation treatment under those two agreements. To conc lude, he will address 
Australia's claims that Regulation 2081/92 is  inconsistent with the TBT Agreement. 
 
I. TERMS OF REFERENCE 
4. At the outset, we would like to stress that th e Panel should consider only those claims which 
are properly within its terms of reference.  5. First of all, certain claims of Australia, in particular those regarding the right of objection, 
concern versions of Regulation 2081 /92 which had already been repeal ed at the time that the Panel 
was established. In addition, the complainants have  also referred to certain measures which were not 
yet adopted at the time that the Panel was establis hed. The EC has submitted that such measures 
which were no longer, or not yet, in existence at the time when the Panel was established are not 
within the terms of reference of the Panel. 
 
6. Moreover, a number of claims raised by the co mplainants in their first written submissions are 
based on WTO provisions that were not cited in thei r panel requests. For this reason, the Australian 
claims made under Article 4 of the Paris Conventi on and Articles 43 to 49 of the TRIPS Agreement 
are outside the Panel's terms of reference. The same is true of the complainants' claims under 
Article 2.2 of the Paris Convention. 
 
II. REGULATION 2081/92 DOES NOT DIMI NISH THE LEGAL PROTECTION OF 
TRADEMARKS 
7. The Complainants have raised numerous claims  (we have counted as many as fourteen) to the 
effect that the registration of geographical indi cations under Regulation 2081/92 diminishes the legal 
protection of trademarks. The complainants' argument s could suggest to the Panel that the registration 
of confusing geographical indicati ons is a frequent occurrence in the EC, which should be a cause of 
immediate and serious concern to all WTO Memb ers. That suggestion is totally unfounded. WT/DS174/R/Add.2 
Page B-108  
 
  
8. As of the date of establishment of this Panel,  the EC authorities had registered more than 600 
geographical indications. The complainants have never alleged that any of those geographical 
indications has resulted in a likelihood of confusio n with any prior registered trademark, let alone 
with a trademark owned by a US or by an Australia n national. The complainants' claims, all fourteen 
of them, are purely theoretical. They are based on supposed "systemic" concerns. Those concerns, 
however, have not prevented the complainants fro m enacting in their own statute books legislation 
which is less protective of the rights of trademark owne rs than the EC measure that they attack in this 
dispute.    
A. A
RTICLE  16.1  OF THE TRIPS  AGREEMENT  
1. The issue of "co-existence" 
9. Both Australia and the United States clai m that Article 14(2) of Regulation 2081/92 is 
inconsistent with Article 16.1 of th e TRIPS Agreement in that it allows the "co-existence" of a later 
confusing geographical indication and a prior registered trademark.  
 
10. As we have shown, this clai m is unfounded for several reasons. 
 11. First
, this claim is wrong as a matter of fact. Be cause of the registrability criteria provided 
under EC trademark law, the risk of confusion be tween trademarks and geographical indications is 
very limited. To the extent that there subsists an y such risk, the problem is addressed adequately by 
Article 14(3) of Regulation 2081/92. The complain ants have mischaracterized that provision. 
Article 14(3) is  not a "narrow exception". The term s of Article 14(3), if properly interpreted, are 
sufficient to prevent the registration of any confusing geographical indications.   12. In order to substantiate their claim, the co mplainants should have established that Regulation 
2081/92 mandates necessarily the registration of later confusing geographical indications. In turn, this 
would have required them to show that Article 14(3) cannot be inte rpreted in a manner which allows 
the registering authority to refuse the registration of confusing geographical indications. At the very 
least, the complainants should have  established that, in practice, Artic le 14(3) is being interpreted and 
applied in a manner which results in a consistent pattern of registrations of confusing geographical 
indications. The complainants have proved none of th is. Indeed, they have not even attempted to do 
so. As mentioned, their complaint is purely theoretic al. The Panel, therefore, should conclude that, as 
a matter of fact, the complainants' claim would be  unfounded even on their own interpretation of 
Article 16.1 of the TRIPS Agreement.   13. Second
, in any event, the complainan ts' interpretation of Article 16 .1 is wrong as a matter of 
law. The complainants' claim rests on a misconcep tion of the relationship between trademarks and 
geographical indications. The TRIPS Agreement r ecognises geographical indications as intellectual 
property rights, on the same level as trademarks. It confers no superiority to trademarks over 
geographical indications. Nor are the provisions of Pa rt II, Section 3, "exceptions" to Article 16.1. 
There is no hierarchy between them. In an attemp t to establish the superiority of trademarks over 
geographical indications, the complainants have em phasised the exclusivity of trademarks. But from 
this it does not follow that trademarks must prevail over geographical indications. Geographical 
indications are also exclusive rights.    14. The boundary between a Member's right to pr otect geographical indications and its obligation 
to protect trademarks is not established in Article 16.1. It is defined in Article 24.5 of the TRIPS 
Agreement. Article 14(2) of Regulation 2081/92 is fully consistent with Article 24.5, which provides 
that Members shall not prejudice "the right to use a trademark". Had the drafters meant to exclude the co-existence of trademarks and later geographical in dications, they would have provided instead that  WT/DS174/R/Add.2 
 Page B-109 
 
 
 Members shall not prejudice "the exclusive  right to use a trademark". Furthermore, if Article 24.5 did 
not allow co-existence, the protection of geographical indications would become pointless whenever there is a grandfathered trademark. Indeed, why protect a geographical indication against illegitimate 
uses by third parties if the legitimate users cannot u se it themselves? Yet, Article 24.5 envisages such 
protection even in the presence of grandfathered trademarks. 
 
15. Co-existence may not be a perfect solution, but then there is no such perfect solution. Co-
existence is, nonetheless, a more reasonable solution th an a rigid application of the first-in-time rule, 
because when comparing trademarks and geographical  indications one is not comparing apples with 
apples. Trademarks and geographical indications are distinct intellectual property rights, each with a 
different subject matter and a different function. Moreover, the co-existence of intellectual property 
rights is by no means an unusual solution. Severa l other provisions of the TRIPS Agreement provide 
expressly for co-existence. The same is true of the law of other Members, including the United States itself.  
16. The following example, drawn from the US own practice, illustrates the unreasonable 
consequences of the interpretation put forward by th e complainants in this dispute. Napa Valley is a 
famous geographical indication for wine. Prior to its official recognition by the US authorities, the term "Napa" had been registered as part of several trademarks, some of which were not used for wine 
originating in that region. On the complainants' in terpretation, the owners of  those trademarks should 
be entitled to prevent the winemakers of Napa Valle y from using that term in order to describe the 
origin and the characteristics of their wine. This r esult would be manifestly inequitable. And, indeed, 
the US authorities seem to agree. The applicable  regulations reserve the term "Napa Valley" 
exclusively for the wine originating in that region.  By way of exception, prior trademarks including 
that name are allowed to "co-exist" with that geographical indication, subject to certain labelling 
requirements. This solution is similar to that provided under Regulation 2081/92. The EC, therefore, 
fails to understand why the Unite d States has considered it necessary to bring this claim against 
Regulation 2081/92.   17. Third
, irrespective of whether the co-existence of geographical indications and earlier 
trademarks is envisaged by Article 24.5 of the TRIPS Agreement, the EC is required to maintain such 
co-existence by virtue of Article 24.3, a "s tand-still" provision that prohibits Members from 
diminishing the level of protection of geographical i ndications that existed at the time of entry into 
force of the WTO Agreement.   18. Finally
, even assuming that Article 14(2) of Regulation 2081/92 were prima facie  inconsistent 
with Article 16.1, it would be justified as a "lim ited exception" to the trademark owner's exclusive 
rights under Article 17 of the TRIPS Agreement. 
 
2. Article 16.1 does not confer a right of objection 
19. Australia (but not the United States) also clai ms that Regulation 2081/92 is inconsistent with 
Article 16.1 of the TRIPS Agreement in that it r estricts the grounds on which trademark owners may 
object to the registration of a geographical indication and does not ensure that objections from 
trademark owners are considered by the Committee. 
 20. These claims are based on a mistaken prem ise. Contrary to Australia's assumption, 
Article 16.1 does not confer to trademark owners a right of objection. The wording of Article 15.5 and 
62.4 of the TRIPS Agreement is unequivocal in this  respect. Members may, but are not required to, 
make available opposition procedures. In any event, as a matter of fact, Article 7(4) of Regulation 
2081/92 does not limit the grounds of objection in the manner alleged by Australia. Nor is it correct 
that the Committee is the "ultimate decision-make r" under Regulation 2081/92. Furthermore, while WT/DS174/R/Add.2 
Page B-110  
 
 Member States are not required to forward all objections to the Commission, their decisions are not 
discretionary and may be subject to judicial review.  B. A
RTICLE  20 OF THE TRIPS  AGREEMENT  
21. Australia (but not the United States) claims th at, by requiring the co-existence of  an existing 
trademark and a later geographical indication, Article 14(2) of Regul ation 2081/92 "encumbers 
unjustifiably" the use of the trademark, thereb y violating Article 20 of the TRIPS Agreement.  
 22. As we have shown, Australia  has misunderstood the purpose and the scope of Article 20. That 
provision is not concerned with the issue of exclusivity (i.e. who has the right to use a sign). Instead, 
Article 20 addresses the distinct issue of which requirements may be imposed upon the trademark 
right holder with respect to the use of his own trademark. As described in our first written submission, 
on Australia's interpretation, Article 20 would overlap and conflict with  Article 16. The three 
examples of "special requirements" included in its first sentence confirm beyond doubt that Article 20 
does not address the issue of exclusivity. 
 
C. A
RTICLE  24.5  OF THE TRIPS  AGREEMENT  
23. Australia (but, again, not the United States) cl aims that Article 14(1) of Regulation 2081/92 is 
inconsistent with Article 24.5 of the TRIPS Agreemen t because it does not afford the right of priority 
provided in Article 4 of the Paris Convention (1967).  
 
24. As the EC has already explained, Article 4 of the Paris Convention was not identified in 
Australia's Panel request and is therefore outside the terms of reference. Moreover, this claim is 
insufficiently argued and difficult to understand. In so  far as the EC understands it, Australia's claim is 
patently flawed. Article 24.5 requires to afford the priority right of Article 4 of the Paris Convention 
(1967) to those applications that are "grandfathered" by virtue of that provision. But Article 4 of the 
Paris Convention (1967) cannot be applied in or der to determine whether an application is 
"grandfathered".   D. P
ART III OF THE TRIPS  AGREEMENT  
25. Australia and the United States claim that Re gulation 2081/92 is incons istent with numerous 
provisions of Part III of the TRIPS Agreement becau se it does not afford to trademark right holders 
the enforcement rights stipulated in those provisions. 
 26. These claims are unfounded because Part III of the TRIPS Agreement does not apply to 
Regulation 2081/92.  
27. Regulation 2081/92 lays down an administra tive procedure for the acquisition of geographical 
indications via a system of registration. It does not purport to regulate the procedures for enforcing trademark rights. Those procedures are provided in th e trademark laws, and related civil and criminal 
procedural laws, of the EC and of its Member States.  Those laws are not within the terms of reference 
of the Panel.  
28. The TRIPS Agreement draws a clear distinc tion between, on the one hand, the procedures for 
the "enforcement" of intellectual property rights, wh ich are provided in Part III, and, on the other 
hand, the "procedures for the acquisition and ma intenance of intellectual rights and related inter 
partes  procedures", which are dealt with in Part IV. The procedures provided in Regulation 2081/92 
fall clearly within the second category and are subject  exclusively to Part IV, and not to Part III. 
  WT/DS174/R/Add.2 
 Page B-111 
 
 
 29. The granting of an intellectual property righ t in accordance with the domestic law of each 
Member is not an "infringement" and, therefore, is  not subject to Part III of the TRIPS Agreement. 
The subsequent use of a validly granted intellectual property right in conformity with the domestic laws of a Member is also not an "infringement". Requiring Members to provide judicial "enforcement" procedures against acts that are co nsistent with their ow n domestic laws, but are 
inconsistent with Part II of the TRIPS Agreement, would be as much as requiring them to give direct 
effect to the WTO Agreement in their domestic le gal order.  The EC would be surprised if the 
complainants agreed with that proposition.  30. Furthermore, applying the provisions of Pa rt III to the procedures for the acquisition of 
intellectual property rights, such as those regul ated in Regulation 2081/1992, would render redundant 
many of the provisions of Part IV and give rise to conflicts between Part III and Part IV. 
 31. Moreover, it would have unacceptable results for most Members. It would mean, for example, that intellectual property rights woul d have to be conferred always by a judicial body in accordance 
with judicial procedures, rather than by an ad ministrative body in accordance with administrative 
procedures, as is currently the case in most Member s, including Australia and the United States. The 
EC does not believe, for instance, that the complain ants' own systems of registration of trademarks, 
which are operated by an administrative body, would comply with the provisions of Part III.  
III. THE EC MEASURE IS CONSISTENT WITH THE OBLIGATION TO PROVIDE 
PROTECTION TO GEOGRAPHICAL INDICATIONS UNDER ARTICLE 22 OF 
THE TRIPS AGREEMENT 
32. Australia and the United States have submitte d very different claims under this heading.
  
 33. Australia's claims are, once again, insufficie ntly argued and difficult to understand. Australia 
suggests that the alleged violation would arise from the fact that there is no "Community-wide system 
of protection" outside Regulation 2081/92. However, there is no basis in Article 22.2, or anywhere 
else in the TRIPS Agreement, for the proposition that  protection must be provided at any particular 
territorial level. Again, the EC would be surprised  if it were the considered view of Australia, a 
federal state, that the WTO Agreement may affect the constitutional allocation of competencies within 
Members.   
 
34. For its part, the United States claims that Re gulation 2081/92 is inconsis tent with Article 22.2 
because it fails to provide to "interested parties" established outside the EC the means to prevent the 
acts specified in that provision. As  we have shown in our first writt en submission, the grounds alleged 
by the United States are either incorrect, as a matte r of EC law, or irrelevant under WTO law.  
 
35. In any event, Regulation 2081/92 is not the only means made available by the EC and its 
Member States. Additional means of protection are provided in:   
 •  Directive 2000/13/EC on the labelling, presenta tion and advertising of foodstuffs and 
implementing legislation of the Member States;
  
 
 •  Directive 84/450 on misleading advertising and implementing legislation of the 
Member States;  
 
 •  the Trademarks Directive and implementing legislation of the Member States; 
 
 •  the Community Trademark Regulation; and 
 WT/DS174/R/Add.2 
Page B-112  
 
  •  the unfair competition laws of the Member States.  
 36. The United States was aware of the above measu res, which were specified in the responses 
provided by the EC and its Member States in the context of the review under Article 24.2 of the 
TRIPS Agreement and have been notified to the WTO.   37. The means of protection provided by th ese measures are sufficient in themselves to 
implement the EC's obligation under Article 22.2. In an y event, they are outside the terms of reference 
of the Panel. 
 
IV. REGULATION 2081/92 IS COMPATIB LE WITH NATIONAL TREATMENT 
OBLIGATIONS, AND DOES NOT IMPOSE A REQUIREMENT OF DOMICILE OR ESTABLISHMENT 
38. The complainants have raised a large numbe r of claims alleging that Regulation 2081/92 is 
incompatible with national treatment obligations  under the TRIPS Agreement or under the GATT, 
and with the prohibition on requirements of domicile  or residence in Article 2.2 of the Paris 
Convention.  39. As the EC has shown in its written submission,  these claims are unfounded both in fact and in 
law. In particular, many of the claims of the comp lainants seem to be based on misunderstandings of 
the content of Regulation 2081/92. The EC will now briefly recall its main arguments regarding the 
most salient of these claims.  A. N
ATIONAL TREATMENT UNDER THE TRIPS  AGREEMENT  
1. The conditions for the registration of ge ographical indications from third countries 
40. The complainants have argued that Regul ation 2081/92 violates the national treatment 
obligation of the TRIPS Agreement by imposing a condition of reciprocity and equivalence for the 
registration of geographical indications relating to areas located outside the EC.  41. At the outset, the EC would like to point ou t that neither complainant has identified an 
example where the EC has refused to register a geographical indication from the United States or 
Australia – or from any other WTO Member, for that  matter – on account of conditions of reciprocity 
and equivalence. In fact, there has never been an application for registration of a geographical 
indication from the United States or Australia. Like  many other claims in the present dispute, it 
appears therefore that this claim is purely theoretical in nature.  
42. More importantly still, the claim is based on a misinterpretation of the Regulation. As the EC 
has set out in its first written submission, the EC does not impose conditions of reciprocity and equivalence on the registration of geographical i ndications from other WTO Members. Article 12 (1) 
of Regulation 2081/92, on which the complainants  have based their arguments, clearly applies 
"without prejudice to international agreem ents", including the WTO Agreements.  
 
43. This important element of Article 12 (1) has been completely ignored by the complainants. Under the TRIPS Agreement, WTO Members are ob liged to provide protection to geographical 
indications. This is why the EC does not apply co nditions of reciprocity an d equivalence to other 
WTO Members. Moreover, other provisions of Regul ation 2081/92, in particular those regarding the 
right of objection, similarly distinguish the situation of WTO Members from that of other third 
countries. Accordingly, it should be clear that WTO Members are not in the same situation as other 
third countries with respect to the registration of  geographical indications relating to areas on their 
territory.  WT/DS174/R/Add.2 
 Page B-113 
 
 
  
44. Accordingly, the registration of geographical  indications from other WTO Members is subject 
to exactly the same conditions as the registration of  geographical indications from the EC. As the EC 
has confirmed in its written submission, this means that geographical indications must comply with 
the same requirements regarding product specifi cations as geographical indications from the EC. 
Moreover, just like for EC indications, there must be  inspection structures in place that ensure that the 
products comply with the product specifications for the specific geographical indication in question. 
 45. In their written submission, the complainants ha ve not made clear whether they also consider 
these product-specific requirements to be in violatio n of national treatment obligations. In case they 
intended such a challenge, the EC w ould like to affirm that this would be manifestly unfounded. The 
very definition of a geographical indication is that products must have a certain quality, reputation, or 
other characteristics attributable to their geographical  origin. The regulation simply intends to ensure 
that products using a protected name indeed comply  with these requirements, and it does so in a way 
which does not distinguish between domestic and foreign products. The application of these product-
specific conditions does therefore not constitute  less favourable, but indeed equal treatment. 
 46. As a final point, the EC would like to reca ll that Article 3.1 TRIPS Agreement, just like 
Article 2.1 of the Paris Convention, requi res national treatment as between nationals
, i.e. natural or 
legal persons. National treatment under the TRIPS Agreement therefore differs in an important 
respect from Article III:4 GATT, which requires na tional treatment as between foreign and domestic 
products . It is striking that in their written submi ssions, the complainants do not acknowledge this 
important difference, and indeed provide no indica tion of how they consider that Regulation 2081/92 
discriminates between nationals.  47. Contrary to the assumption of the complainants, the conditions for registration of 
geographical indications do not de pend on nationality. The regulation contains parallel procedures for 
the registration of geographical indications, dependi ng on whether the area to which the indication is 
related is located inside or outside the EC. This is a question which may concern the origin of the 
product, but which has nothing to do with the na tionality of the producer. The nationality of the 
producers is simply of no relevance for the registra tion of geographical indications. Accordingly, for 
this reason also, the Regulation cannot be said to  discriminate between EC and non-EC nationals. 
 
48. For all these reasons, the conditions for regi stration of geographical indications are fully 
compatible with national treatment obligations.  
2. The right of objection 
49. The complainants have also claimed that Regulation 2081/92 violates the national treatment 
obligation under the TRIPS Agreement by subjecting th e right to object to a registration to conditions 
of reciprocity and equivalence.  50. Once again, this claim is based on an incorr ect interpretation of Regulation 2081/92. As the 
EC already has set out, Article 12d (1) of Regulation 2081/92 gives a right to object to any person that 
"is from a WTO Member or
 a third country recognised under the procedure provided for in Article 12 
(3)". It is therefore clear that WTO Members ar e not subject to the procedure of Article 12 (3) 
applicable to other third countries. The same a pplies also under Article 12b (2) with respect to 
objections against the registration of geog raphical indications from outside the EC. 
 
51. Moreover, the claim is also legally unfounded. Once again, the complainants fail to establish 
that there is discrimination between nationals . Article 12d (1) of the Regulation refers to persons 
resident or established outside the EC, regardless of their nationality. It cannot simply be assumed that 
the reference to "nationals" in the national treatme nt provisions of the TRIPS Agreement also applies WT/DS174/R/Add.2 
Page B-114  
 
 to persons who are domiciled or established abroad, regardless of their nationality. In fact, conditions 
regarding domicile or establishment are the subject of  Article 2.2 Paris Convention, on the basis of 
which the complainants have formulated separate cl aims. It is not clear to the EC how these claims 
are consistent with the complainant's apparent view  that Article 3.1 TRIPS Agreement and 2.1 of the 
Paris Convention also provide for national treatme nt between domestic and foreign residents. 
 
3. The transmission of applications and objections 
52. The complainants have argued that the require ment that applications for the registration of 
geographical indications must be transmitted by the government of the country where the 
geographical area is located, constitutes a violation of national treatment obligations. Moreover, they 
have raised the same claim also with respect to the transmission of statements of objection. 
 53. The EC considers this claim to be unfounded. First of all, the requirement of transmission 
through governmental channels applies to domes tic and foreign geographical indications alike. 
Accordingly, the Regulation cannot be said to disc riminate between nationa ls, nor between foreign 
and domestic geographical indications. 
 54. More importantly still , governments fulfil an important role in the registration process. It is 
clear that the government in whose territory the ge ographical area is located to which a geographical 
indication relates, is better placed than any other to  verify the admissibility of applications relating to 
such an area. It is rather striking to the EC that the complainants seem to consider that the protection 
in one country of a geographical indication related to an area located in th e territory of another 
country could be achieved without any cooperation between the two countries concerned. Moreover, 
it does not appear that the responsibilities of govern ments in the transmission of applications and 
objections are unduly burdensome or difficult for another WTO Member to fulfil.  
55. In fact, as the complainants themselves have indicated in their written submission, the real 
problem is essentially their absence of "inclinatio n" to cooperate in the process. However, this 
unwillingness to cooperate is not attributable to the Community, but is the choice of the complainants. 
The complainants should therefore not be permitted to label as less favourable treatment by the EC a situation that would exclusively be due to their own attitude.  4. Indication of the country of origin for homonymous names 
56. The United States has argued that Article 12 (2) of Regulation 2081/92 provides less 
favourable treatment to nationals because it requir es in certain circumstances the indication of the 
country of origin.  
57. Once again, this claim is theoretical in natu re, and is moreover based on a misinterpretation of 
the Regulation. First of all, it should be relativel y clear that Article 12 (2) is not a provision which 
requires the origin labelling of protected products generally, but is a provision which applies only in 
very specific circumstances, namely where there are identical protected names from the EC and a 
third country.  
58. Secondly, the provision, when understood prop erly, in no way discriminates between foreign 
and domestic geographical indications, let alone nationals. It simply requ ires that the country of origin 
be indicated in order to avoid confusion and to achie ve a clear distinction in practice. Logically, this 
requirement will normally be applied to whichever name is protected later, regardless of whether this 
is the EC or the foreign indication. Accordingly, Article 12 (2) of the Regulation treats foreign and 
domestic products exactly alike. 
  WT/DS174/R/Add.2 
 Page B-115 
 
 
 5. The historical claims of Australia 
59. Australia has formulated a number of claims al so regarding the alleged absence of a right of 
objection under Regulation 2081/92 before it wa s amended through Regul ation 692/2003, which 
entered into force on 8 April 2003.   
60. The EC finds it astonishing to have to defe nd itself against claims which are formulated 
essentially in the past tense. The objective of WTO dispute settlement is to solve actual disputes and 
to achieve compliance with WTO obligations. It is not the object of WTO dispute settlement to dwell 
on historical grievances, whether real or percei ved. As the EC has already stated, it therefore 
considers that Australia's claims relating to measur es no longer in force at the time of the Panel's 
establishment are outside the Panel's terms of reference. 
 61. However, since Australia has raised these hi storical claims, the EC nonetheless would like to 
take the opportunity to correct the historical fact s. Australia has referred to the simplified procedure 
which used to be provided for in Article 17 of Re gulation 2081/92, and has claimed that under this 
procedure, a right of objection was available to EC residents which was not available to foreign 
residents. This claim is historically incorrect. As  the EC has set out in its first written submission, 
under Article 17 of Regulation 2081/92, the right of  objection was explicitly excluded. Therefore, 
there existed no possibility for objection, regardless of whether the person in question was an EC or a 
foreign resident. Australia's claims of unequal treat ment are already for this reason deprived of any 
historical basis. 
 
62. The EC notes furthermore that in its submissi on, Australia appears to have made its national 
treatment claims not just with respect to the Regul ation itself, but also with respect to the over 600 
registrations of individual geographical indications carried out until the entry into force of Regulation 
692/2003. In the view of the EC, this apparent a ttempt to invalidate the individual registrations is 
devoid of all legal basis. The registrations of the i ndividual indications are not in violation of national 
treatment obligations. In reality, Australia is simp ly attacking the procedure that was set out in 
Regulation 2081/92 until its amendment through Re gulation 692/2003, but which it did not challenge 
when it was still in force.   63. Moreover, Australia seems to forget that WT O remedies are not retroactive. Even if it had 
challenged Regulation 2081/92 befo re it was amended through Regula tion 692/2003, all it could have 
achieved would have been the amendment of that pa rticular measure. It could not have claimed the 
cancellation of the hundreds of geographical indications already registered. It seems to the EC that not 
having attacked Regulation 2081/92 before it was am ended, Australia can certainly not claim more 
now than it could have claimed then. 
 
B. P
ROHIBITED REQUIREMENT OF DOMICILE OR ESTABLISHMENT  
64. The United States has claimed that the conditio ns for registration of geographical indications 
amount to a requirement of domicile or establis hment prohibited by Article 2.2 of the Paris 
Convention. As the EC has already mentioned, this claim was not identified in the Panel requests, and 
is therefore outside the terms of reference of the Panel. Moreover, as the EC has also set out, this 
claim also fails on its merits. 
 65. In a first alternative, the United Stat es has argued that Regulation 2081/92 imposes a 
requirement of domicile or establishment because it prevents a US national from registering a geographical indication relating to an area located in  the US. Quite apart from the question of whether 
this has anything to do with domicile or estab lishment, the EC has already confirmed that 
geographical indications relating to areas in the US can
 be registered under Regulation 2081/92. 
Therefore, this claim must fail. WT/DS174/R/Add.2 
Page B-116  
 
  
66. Presumably conscious of this weakness, th e United States has also tried an alternative 
formulation of this claim. In this formulation,  Regulation 2081/92 imposes a requirement of domicile 
or establishment because a US national could not register a geographical indication relating to an area located in the EC without some form of investment or business establishment in the EC. 
 
67. This claim already does not do justice to the content of Regulation 2081/92. Faithful to Article 22.1 of the TRIPS Agreement, Regulatio n 2081/92 requires that in order to qualify for 
protection as a geographical indication, the product in question must possess characteristics attributable to that geographical origin and that  "the production and/or processing and/or preparation
" 
of the product must take place in the defined geographical area. Nowhere does the Regulation, nor 
indeed Article 22.1 of the TRIPS Agreement, im pose a requirement of domicile or establishment. 
 68. Moreover, the implications of the United St ates claim are worth noting. The United States 
seems to believe that a US nationa l should be allowed to register a geographical indication relating to 
an area in the EC regardless of whether this produ cer or his products have any link with that area. 
Taken to its logical consequence, this view of the United States would entirely undermine the 
protection of geographical indications as foreseen in  the TRIPS Agreement. The EC regrets to have to 
say that this claim casts some doubt on how serious ly the United States takes the conditions for the 
protection of geographical indications.  
69. Finally, both complainants have also a lleged that the conditions for objecting to the 
registration of geographical indications impose a requirement of domicile or establishment. These 
claims seem to be based on th e assumption that residents of WTO Members cannot object under the 
Regulation. As the EC has already stated, that is not so. Accordingly, this claim is unfounded.  
C. N
ATIONAL TREATMENT UNDER ARTICLE  III:4  GATT 
70. The complainants have raised a number of their national treatment claims also under the 
GATT, namely as regards the conditions of registra tion, the transmission of applications, and the 
labelling of homonymous geographical indications. 
 71. As the EC has already set out, none of these elements of Regulation 2081/92 constitute less 
favourable treatment, regardless of whether one refers  to nationals or to goods. The EC will therefore 
not restate its arguments in this respect, which equally apply to Article III:4 GATT. 
 72. The EC would merely signal one additional question regarding the issue of origin labelling, 
which the Panel would have to consider should it co me to the conclusion that, contrary to the EC's 
submission, Article 12 (2) of the Regulation doe s involve discrimination between domestic and 
foreign products. When they argue that there is a violation of national treatment under the GATT of other agreements, the complainants seem to have fo rgotten the existence of Article IX GATT, which 
is, however, the specific provision in WTO law concer ning origin marking. Remarkably, Article IX:1 
GATT does specifically contain a most-favoured nation ru le in respect of origin marking, but does not 
contain a national treatment rule. If Article IX:1 GATT is to have any useful meaning at all, then it 
must be that it contains a specific – and exclusive – set of disciplines for origin marking. Accordingly, 
national treatment obligations would not seem to apply to origin marking.  73. As a final point on national treatment unde r the GATT, and only in case the Panel should 
come to the conclusion that Regulation 2081/92 does entail a difference in treatment between 
domestic and foreign products, the EC considers that the challenged elements of Regulation 2081/92 
are justified by Article XX (d) GATT. All relevant aspects of the Regulation, and in particular the 
conditions for the registration of geographical i ndications, are necessary to secure compliance with 
the conditions for the registration and protection of geographical indications.  WT/DS174/R/Add.2 
 Page B-117 
 
 
  
74. In conclusion, Regulation 2081/92 is therefore compatible with national treatment obligations 
under the GATT.  
V. REGULATION 2081/92 IS COMPATIBLE WI TH THE OBLIGATION TO PROVIDE 
MOST-FAVOURED-NATION TREATMENT 
75. The United States has also claimed that Regulation 2081/92 is incompatible with the 
obligation to provide most-favoured-nation treat ment under the TRIPS Agreement and under the 
GATT. In this respect, the US  has claimed that a) the EC discriminates among non-EC WTO 
Members by imposing conditions of reciprocity and equivalence and b) that the EC Member States 
grant each other more favourable treatment than they accord to non-EC WTO Members. 
 A. T
HE EC DOES NOT DISCRIMINATE AMONG WTO  MEMBERS  
76. The first of these US MFN claims is alread y clearly unfounded in fact and in law.  
 
77. First of all, the US claim is based on the assumption that the EC applies a condition of 
reciprocity and equivalence to WTO Members. As the EC has already stated, it does not apply such a condition to WTO members. Therefore, WTO Member s are treated as well as any other in respect of 
the conditions of registration of geographical indications.  78. Second, the conditions which the Regulation re quires to be fulfilled for registration, notably 
the requirement of product specifications and inspectio n structures, apply without discrimination to all 
foreign products. Accordingly, they cannot be argu ed to be incompatible with most-favoured-nation 
principles.  79. Third, even if Article 12 (1) of Regulati on 2081/92 did apply to WTO Members, which it 
does not, it is worth pointing out that this provision does not yet confer any advantage on any third 
country. It merely sets out the abstract conditi ons for rendering the Regulation applicable to non-
WTO third countries. These conditions do not distin guish between third countries, and can therefore 
not be said to confer an advantage on any particular country.  80. Finally, as regards most-favoured-nation treat ment under the TRIPS Agreement, it should be 
recalled that unlike Article I:1 GATT, Article 4 TR IPS requires discrimination between nationals, not 
between products. However, Regulation 2081/92 does not  refer to nationality, but to the question of 
where the geographical area is located. As the EC h as said already, this may have something do with 
the origin of the product, but it has nothing to do with the nationality of the producer.  
81. For all these reasons, this claim of the United States should be rejected. 
 B. R
EGULATION 2081/92  DOES NOT INVOLVE THE GRANTING OF ADVANTAGES BETWEEN 
MEMBER  STATES  
82. The second claim of violation of Article 4 TR IPS Agreement by the United States is a rather 
curious one. In essence, the United States is arguing that "through Regulation 2081/92", EC Member 
States are granting "each other" advantages, which are not available to other WTO Members, and are 
thereby violating Article 4 TRIPS.  83. In the view of the EC, this claim is entirel y unfounded. To begin w ith, as the EC has already 
set out, the conditions for the registration of ge ographical indications do not discriminate between 
geographical indications from the EC and from WTO countries. Accordingly, the EC does not 
understand which are the specific advantages which the US claims are being withheld from it. WT/DS174/R/Add.2 
Page B-118  
 
  
84. Moreover, Article 4 TRIPS refers to advantages which are granted to the "nationals of another 
country". Regulation 2081/92 does not grant any advantage to nationals of "another country". The EC is a founding member of the WTO. When it adopts a measure which harmonises the law within the EC, it does therefore neither grant its Member States any advantages, nor do its Member States grant 
each other advantages. 
 85. As the United States knows perfectly well, Regul ation 2081/92 is a measure of the EC. This is 
why the United States has correctly brought this case against the EC, and not against its Member 
States. The US claim that "through Regulation 2081/92", Member States are granting each other 
advantages is therefore entirely artificial and in c ontradiction with the United States' own actions in 
the present dispute settlement proceedings.  
VI. REGULATION 2081/92 IS CONSISTENT WI TH OBLIGATIONS UNDER THE TBT 
AGREEMENT 
86. Australia has alleged that Regulation 2081/92 is  inconsistent with the TBT Agreement in two 
respects: first, it has claimed that the requirement to  indicate the country of origin in Article 12 (2) of 
the Regulation is inconsistent with Article 2. 1 TBT Agreement; and second, it has claimed that 
Articles 4 and 10 of Regulation 2081/92 are incompa tible with Article 2.2 TBT Agreement to the 
extent that the require they ex istence of inspection structures. 
 
A. R
EGULATION 2081/92  IS NOT A TECHNICAL REGULATION  
87. Article 2 of the TBT Agreement applies only to technical regulations. The claims raised by 
Australia under the TBT Agreement must fail alread y because none of the provisions of Regulation 
2081/92 challenged by Australia constitutes a techni cal regulation within the meaning of the TBT 
Agreement. 
 
1. Article 12 (2) of Regulation 2081/92 is not a technical regulation 
88. As the EC has already set out in its writte n submission, Article 12 (2) is not a technical 
regulation within the meaning of the TBT Agreement.  89. First of all, Article 12 (2) does not apply to a ll agricultural products and foodstuffs covered by 
the Regulation, but only to products in the specific si tuation envisaged in the provision, namely where 
a protected name from the EC is identical to a pr otected name from a third country. Accordingly, 
Article 12 (2) does not apply to identifiable products.   90. Moreover, Article 12 (2) does not lay down pro duct characteristics. First of all, the provision 
does not itself lay down how any specific product shoul d be labelled. As the EC has set out in its 
written submission, where the situation envisaged in  Article 12 (2) occurs, the labelling requirement 
will normally be part of the product specifications. In  addition, the indication of the country of origin 
does not constitute a labelling requirement as it app lies "to a product, process or production method". 
 91. Finally, it should also be noted that the possibility for registration under Regulation 2081/92 
is a right, but is not a condition for marketing of  products in the EC. The registration process is 
entirely voluntary. Accordingly, Regulation 2081/92 cannot be held to lay down product 
characteristics with which compliance is mandatory.   WT/DS174/R/Add.2 
 Page B-119 
 
 
 2. Articles 4 and 10 of Regulation 2081/92 are not a technical regulation 
92. With its claim regarding Articles 4 and 10 of  Regulation 2081/92, Australia is challenging the 
requirement that inspection structures must exist. As follows from Article 10(1) of 
Regulation 2081/92, the objective of inspection structures is to ensure that agricultural products and foodstuffs bearing a protected name meet the requirements laid down in the specification. 
 
93. As the EC has set out in its first written s ubmission, this requirement of the existence of 
inspection structures cannot be regarded as cons tituting a technical regulation. Under the TBT 
Agreement, a technical regulation is a me asure which lays down product characteristics
. The TBT 
Agreement carefully distinguishes technical regul ations from conformity assessment procedures, 
which are used to determine whether the requireme nts contained in technical regulations are met. 
Whereas technical regulations are dealt with in Articles 2 and 3 of the TBT Agreement, the WTO 
obligations regarding conformity assessment procedur es are set out separately in Articles 5 to 9 of the 
TBT Agreement.   
94. Even if the product specifications, with which the inspection structures must ensure 
conformity, were to be regarded as a technical re gulation, then the inspection structure itself could 
still not be regarded as a technical regulation falli ng under Article 2 of the TBT Agreement. Rather, it 
would have to be regarded as a conformity assessme nt procedure falling under Articles 5 to 9 of the 
TBT Agreement. However, Australia has not referred to these provisions in its panel request, so that 
such a claim would be outside the terms of reference of the panel. 
 
95. For this reason, Articles 4 and 10 of Regul ation 2081/92 cannot be regarded as technical 
regulation falling under Article 2 of the TBT Agreement.  B. A
RTICLE  12 (2) OF REGULATION 2081/92  IS NOT INCOMPATIBLE WITH ARTICLE  2.1 OF THE 
TBT  AGREEMENT  
96. Australia has claimed that the requirement to i ndicate the country of origin in Article 12 (2) of 
Regulation 2081/92 violates the national treatment pr ovision in Article 2.1 TBT Agreement. In the 
view of the EC, even if the Panel came to cons ider that Article 12 (2) constitutes a technical 
regulation, this claim would have to fail.  
97. As the EC has said earlier, Article 12 (2) does not treat EC and foreign geographical 
indications differently. It merely requires that wh ere there are identical protected names from the EC 
and from a third country, the country of origin must  be indicated. This requirement may affect the EC 
or the third country geographical indication, whicheve r is registered later. There is therefore perfect 
equality of treatment between domestic  and foreign geographic indications. 
 
98. Australia has criticised the fact that Article  6 (6) of Regulation 2081/92 does not contain the 
same requirement as regards identical geographical i ndications from within the EC. In the view of the 
EC, this comparison is not pertinent. First of a ll, the EC does not see how Australian products can be 
disadvantaged by the way in which conflicts between homonyms from within the EC are being 
resolved. Moreover, it should be noted that Article 6 (6) deals with a larger set of potential conflicts 
than Article 12 (2). In particular, it also may c oncern conflicts between geographical indications from 
within the same Member State. It is therefore not surprising that the provision requires a "clear 
distinction in practice", rather than requiring the indication of the country of origin in all cases. 
 WT/DS174/R/Add.2 
Page B-120  
 
 C. A
RTICLES 4, 10, AND 12 (1) OF REGULATION 2081/92  ARE NOT INCOMPATIBLE WITH 
ARTICLE  2.2 OF THE TBT  AGREEMENT  
99. Finally, even if the Panel considered that Articles 4 and 10 constituted a technical regulation, 
there would be no violation of Article 2.2 TBT Agreement.  
100. Article 2.2 TBT Agreement provides that t echnical regulation must not be more trade-
restrictive than necessary to fulf il a legitimate objective. The EC su bmits that the requirement that 
inspection procedures must exist to ensure that pr oducts bearing a protected name comply with the 
product specifications is necessary to fulfil th e legitimate objectives of Regulation 2081/92. 
 
101. The legitimate objective of the inspection pr ocedures foreseen in Regulation 2081/92 is to 
ensure that products using a protected geogr aphical indication do comply with the product 
specifications, and therefore have the "quality, reput ation or other characteristics" which justify this 
protection. The existence of such inspection pro cedures is beneficial both to consumers and to 
producers. 
 
102. The existence of such inspection structures is also in no way disproportionate to this 
objective. First of all, as the EC has set out in its written submission, Article 10 of Regulation 2081/92 
limits itself to fixing the general principles, and leaves a maximum of flexibility as regards the 
specific design of the inspection procedures. De spite its complaints that Article 10 is unduly 
restrictive and obliges other WTO Members to foll ow an "EC model", Australia has not actually 
explained what specific type of inspection structures it envisages which would be ruled out by 
Article 10 of Regulation 2081/92.  103. In reality, Australia's argument seems to be that the existence of inspection structures should 
be required at all. However, this does not seem to  be compatible with the objectives of Regulation 
2081/92 regarding the protection of geographical indi cations. In fact, Australia does not take into 
account the specific nature of geographical indicati ons, which are defined as having a specific quality, 
reputation, or characteristics attributable to their geographical origin. It is therefore entirely appropriate that the EC provides for mechanisms which ensure that products marketed bearing a 
geographical indication do in fact comply with these requirements.  
104. Whether there are also, as Australia argues, other systems of protection which may achieve 
the objective of protecting geographical indications  in accordance with Article 22 TRIPS is not the 
question. Article 1.1 TRIPS explicitly allows each  WTO member the freedom to determine how to 
implement the provisions of the Agreement within their legal system. Moreover, Article 1.1 also 
allows the WTO Members to provide more extensive protection than required by the Agreement. This 
is indeed what the EC has done in Regulation 2081/ 92. However, it would not be acceptable for third 
country geographical indications to  take advantage of this extensive protection without complying 
with the same requirements as an EC indication. This  would in fact not result in equal treatment, but 
in more favourable treatment for foreign products.  105. Accordingly, Australia's claim under Artic le 2.2 TBT Agreement must be rejected. 
 
* 
 
*         * 
 
106. Thank you for your attention. This conclud es our statement. We look forward to answering 
any questions that the Panel may wish to ask.  WT/DS174/R/Add.2 
 Page B-121 
 
 
 ANNEX B-4 
 
REPLIES BY THE EUROPEAN COMMUNITIES TO QUESTIONS 
POSED BY THE PANEL FOLLOWING THE FIRST SUBSTANTIVE MEETING 
  
TABLE OF WTO CASES REFERRED TO IN THE RESPONSES 
 
Short Title Full Case Title and Citation 
Canada – Autos  Appellate Body Report, Canada – Certain Measures Affecting the Automotive 
Industry , WT/DS139/AB/R, WT/DS142/AB/R, adopted 19 June 2000, 
DSR 2000:VI, 2995 
Canada – Pharmaceutical Patents
  Panel Report, Canada – Patent Protection of Pharmaceutical Products , 
WT/DS114/R, adopted 7 April 2000, DSR 2000:V, 2295 
EC – Asbestos  Appellate Body Report, European Communities – Measures Affecting 
Asbestos and Asbestos-Containing Products , WT/DS135/AB/R, adopted 
5 April 2001 
EC – Bananas III  Appellate Body Report, European Communities – Regime for the 
Importation, Sale and Distribution of Bananas , WT/DS27/AB/R, adopted 
25 September 1997, DSR 1997:II, 591 
India – Patents (US)  Appellate Body Report, India – Patent Protection for Pharmaceutical and 
Agricultural Chemical Products , WT/DS50/AB/R, adopted 16 January 1998, 
DSR 1998:I, 9 
US – Corrosion-Resistant Steel 
Sunset Review  Appellate Body Report, United States – Sunset Review of Anti-Dumping 
Duties on Corrosion-Resistant Carbon Steel Flat Products from Japan , 
WT/DS244/AB/R, adopted 9 January 2004. 
US – Section 110(5) Copyright 
Act  Panel Report, United States – Section 110(5) of the US Copyright Act , 
WT/DS160/R, adopted 27 July 2000, DSR 2000:VIII, 3769 
US – Section 211 
Appropriations Act  Panel Report, United States – Section 211 Omnibus Appropriations Act of 
1998 , WT/DS176/R, adopted 1 February 2002, as modified by the Appellate 
Body Report, WT/DS176/AB/R 
US – Section 211 
Appropriations Act  Appellate Body Report, United States – Section 211 Omnibus 
Appropriations Act of 1998 , WT/DS176/AB/R, adopted 1 February 2002 
US – Section 301 Trade Act  Panel Report, United States – Sections 301-310 of the Trade Act of 1974 , 
WT/DS152/R, adopted 27 January 2000, DSR 2000:II, 815 
 
 
Question 1 
 
To what extent is the Panel bound by the EC's interpretation of its own Regulation? 
 
1. Regulation 2081/92, which is the measure at i ssue in the present proceedings, is an act of EC 
domestic law.  As the Appellate Body has held in India – Patents , domestic law may constitute 
evidence of compliance or non-complian ce with international obligations.1 Accordingly, as the 
Appellate Body has held, a Panel may be required to determine the meaning of an act of domestic law 
in order to establish whether such act is compatible with WTO obligations.2 
 2. The Panel's approach to the interpretati on of Regulation 2081/92 should therefore be 
governed by Article 11 of the DSU, according to wh ich the Panel must make "an objective assessment 
of the facts of the case". Accordingly, the EC does not consider that the Panel is "bound" by the EC's 
interpretation of Regulation 2081/92. 
 
                                                     
 
1 Appellate Body Report, India – Patents , para. 65. 
2 Appellate Body Report, India – Patents , para. 66. WT/DS174/R/Add.2 
Page B-122  
 
 3. However, the EC would like to underline that in making an objective asse ssment of the facts, 
and in particular of the meaning of Regulation 20 81/92, the Panel must take due account of the fact 
that Regulation 2081/92 is a measure of EC dom estic law. It can therefore not "interpret" 
Regulation 2081/92, but rather must establish the mean ing of its provisions as factual elements. In this 
context, reference can be made to th e approach described by the Panel in US – Section 301 :
3 
 
In this case, too, we have to examine asp ects of municipal law, namely Sections 301-
310 of the US Trade Act of 1974.  Our mandate is to examine Sections 301-310 
solely for the purpose of determining whether the US meets its WTO obligations.  In doing so, we do not, as noted by the Appellate Body in India – Patents (US) , interpret 
US law "as such", the way we would, say, interpret provisions of the covered 
agreements.  We are, instead, called up on to establish the meaning of Sections 301-
310 as factual elements and to check whether these factual elements constitute conduct by the US contrary to its WTO oblig ations.  The rules on burden of proof for 
the establishment of facts referred to above also apply in this respect. 
It follows that in making factual findings concerning the meaning of Sections 301-
310 we are not bound to accept the interpretati on presented by the US.  That said, any 
Member can reasonably expect that consider able deference be given to its views on 
the meaning of its own law. 
4. It follows from this approach that th ere are considerable differences between the 
interpretation of the WTO agreements by a Pane l, and the establishment of the meaning of a 
challenged act of domestic law by a Panel. First of all, as a question of fact, the rules regarding the 
burden of proof must apply. Accordingly,  the burden of proof for establishing that 
Regulation 2081/92 as the measure at issue has a pa rticular meaning is on the complainants, not on 
the EC.   
5. This is particularly important in the case of per se  challenges against measures which have so 
far not been applied by the authorities of a Member. In such a case, a Member should not be held in 
violation of its WTO obligations unless it is establishe d beyond doubt that the measure in fact entails 
the violations alleged by the complainants.  6. Second, the establishment of the meaning of an act of domestic law is not governed by the 
customary principles of interpretation of internati onal law. Rather, the objective assessment of the 
facts requires establishing the meaning that the act will normally have within the legal order of the 
WTO Member in question. This means that the in terpretation should be guided by the rules of 
interpretation customary in the legal order of such  member, and taking account of the legal context of 
the measure in the domestic law of the Member. 
 
7. Third, even though a Panel is not bound by the interpretation of a WTO Member of it own measure, due account must be taken of the fact that  it is the authorities of this Member which must 
interpret and apply the measure in the domestic le gal order. Therefore, as the Panel set out in US – 
Section 301 , the explanations given by such Member of  the meaning of its own measure must be 
given considerable deference. 
 
8. This deference accorded to the author of a do mestic act is also illustrated in Panel practice. 
When establishing the meaning of domestic measures, Panels have regularly relied on statements and 
explanations given by the defending party in the course of the proceedings. This is the case for 
instance in US – Section 301 , where the Panel relied to an important  extent on statements made by the 
                                                     
 
3 Panel Report, US – Section 301 , para. 7.18 (footnotes omitted).  WT/DS174/R/Add.2 
 Page B-123 
 
 
 United States as regards the interpretation and application of the challenged measure.4 The same was 
also the case in Canada – Pharmaceutical Patents , where the Panel relied on assurances given by 
Canada during the proceedings.5 Similarly, in US – Section 211 , the Panel relied on a US response 
given to the Panel in order to establish the meaning of the challenged measure.6 
 Question 2 
 
Can the procedures under Articles 5 and 6 of Regulation (EC) No. 2081/92 apply to names of 
geographical areas located outside the EC?  
9. The procedures set out in Articles 5 and 6 of  Regulation 2081/92 in principle apply only to 
names related to geographical areas located inside the EC. The corresponding procedures for geographical indications related to geographical areas located outside the EC are contained in 
Articles 12a and 12b. However, these provisions al so contain a number of references to specific 
sections of Articles 5 and 6, which to this extent are applicable to the registration of geographical 
indications from outside the EC. 
 
Question 3 
 
Did the phrase "[w]ithout prejudice to international agreements" in Article 12(1) of Regulation (EC) 
No. 2081/92 predate the TRIPS Agreement?  Did it refer to any specific agreements when it was 
adopted?  Which agreements does it refer to now?  Would it cover bilateral agreements for the 
protection of individual geographical indications?  
10. The phrase "[w]ithout prejudice to internati onal agreements" was already contained in 
Article 12(1) of Regulation 2081/92 as originally adopted in 1992. 
 
11. The phrase "without prejudice to internationa l agreements" is not in any way limited to 
particular specific agreements or types of agre ements. Accordingly, this phrase applies both to 
multilateral and to bilateral agreem ents. Moreover, the phrase does not just apply to agreements in 
force at the time the Regulation was adopted, but  also to agreements which were adopted 
subsequently. 
 
12. At the time that Regulation 2081/92 was adopted, the GATT was one of the agreements to which the "without prejudice" clause applied. Mo reover, at the time that Regulation 2081/92 was 
adopted, the TRIPS Agreement was in the final phases of its negotiation. It was therefore the 
objective that the "without prejudice" clause should also apply to the TRIPS and other WTO 
agreements resulting from the Uruguay Round. 
 13. The importance of the WTO Agreements, a nd notably of the TRIPS Agreement, for the 
interpretation and application of Regulation 2081/92 was reconf irmed by Regulation 692/2003,
7 the 
8th recital of which prominently refers to the obligations resulting from the TRIPS Agreement. 
 Question 4 
 
Is it unusual that the text of Article 12(1) of Regulation (EC) No. 2081/92 covers only a small number 
of countries that are non-WTO Members, but th e introductory phrase "[w]ithout prejudice to 
                                                     
 
4 Panel Report, US – Section 301 , para. 7.125. 
5 Panel Report, Canada – Pharmaceutical Patents , para. 7.99. 
6 Panel Report, US – Section 211 , para. 8.69. 
7 Exhibit COMP 1h. WT/DS174/R/Add.2 
Page B-124  
 
 international agreements" covers th e entire membership of the WTO?   Why was this structure 
retained when the Regulation was amended in April 2003?  
14. The EC does not consider this as unusual. First, the EC would like to point out that out of the 
191 current Members of the United Nations, 48 are not Members of the WTO, including certain 
important countries such as Russia. Therefore, even though this group has been shrinking since the 
establishment of the WTO, the EC does not consider this number as "small".  15. It is also not surprising that the fundamenta l structure of Article 12 was not changed. When 
proposing to amend an act of the Council, it is a concern for the Commission to preserve the Council 
act to the extent that it does not require amen dment. Therefore, the Commission proposal will 
frequently limit itself to those amendments which ar e strictly speaking necessary, and will leave those 
provisions the amendment of which is not necessary untouched.  
Question 7 
 
Do the last sentence of Article 12(3) of Regu lation (EC) No. 2081/92 and the first clause in 
Article 12a "[i]n the case provided for in Artic le 12(3)" limit the app licability of Article 12a? 
 
16. No. The last sentence of Article 12 (3) of Regulation 2081/92 merely provides that where the 
Commission decision provided for in this provision is in the affirmative, the procedure set out in 
Article 12a shall apply. This does not mean that the procedure in Article 12a cannot apply in other 
cases.  17. As regards the reference in Article 12a (1) to  Article 12 (3), the EC would like to point out 
that Article 12 (3) refers to the conditions set out in  Article 12(1). As the EC has confirmed, by virtue 
of the "without prejudice" clause, these conditions do  not apply to WTO Members. Accordingly, since 
the procedure in Article 12 (3) is inapplicable to WT O Members, so is the reference to this provision 
in Article 12a (1).  
Question 8 
 
Which references to a "third country" in Articles 12, 12a, 12b and 12d of Regulation (EC) No. 2081/92 include all WTO Members, and which do not?  What, in the co ntext of each reference, 
indicates what "third country" means ?  Why are different terms not used?  
 
18. Whether the term "third country" includes WTO Members or not must be established on the basis of the wording, context, and objectives of th e specific provision in question. In Article 12(1) of 
Regulation 2081/92, this context includes the "without  prejudice" clause. Accordingly, as the EC has 
explained, the references to "third countries" in Article 12(1) do not include WTO Members. The 
same applies where a provision refers to a "third  country meeting the equivalence conditions of 
Article 12(3)" (Article 12b[2][b]) or a "third c ountry recognised under the procedure provided for in 
Article 12(3)" (Article 12d[1]), or where a provision  specifically distinguishes between third countries 
and WTO Members. Where this is not the case, as for instance in Article 12a(1) or Article 12b(1), the 
reference to third countries may also include WTO Members.   WT/DS174/R/Add.2 
 Page B-125 
 
 
 Question 9 
 
Why is it that only the rights of objection in Articles 12b(2)(a) and 12d(1) of Regulation (EC) 
No. 2081/92 mention a "WTO Member" or "WTO member country"?  Is it relevant that 
Regulation (EC) No. 692/2003 explained, in its 10th recital, that in the matter of objections the 
provisions in question apply without prejudice to international agreements but, in its 9th recital, it 
explained that the protection provided by registra tion is open to third countries' names by reciprocity 
and under equivalence conditions?  
19. This is due to the differences in the st ructure of Article 12 on the one hand, and of 
Articles 12b and 12d, on the other. Article 12 contains  the introductory clause "without prejudice to 
international agreements", which made it possible not to specifically single out the position of WTO 
Members in the text of the provision. Articles 12b and 12d do not contain such a clause, so that it was necessary to differentiate between WT O Members and other third countries. 
 
20. The 10
th recital of Regulation 692/2003 confirms this interpretation by stating that the 
objective of the amendment of the provisions regard ing objections was "that it should be made clear 
that in this matter nationals of WTO member count ries are covered by these arrangements and that the 
provisions in question apply without prejudice to international agreements ". In order words, the 
distinction between WTO Members and third count ries was intended to have exactly the same 
function as the without prejudice clause in Article  12(1) of Regulation 2081/92. Given this common 
objective of ensuring compatibility with WTO oblig ations, the differences in drafting technique 
between Articles 12(1) and 12b and 12d appear secondary.  21. As regards the 9
th recital, this recital refers to the reciprocity and equivalence conditions "as 
provided for in Article 12" of Regulation 2081/92. This reference of course includes the "without 
prejudice" clause of Article 12(1). Accordingly, the 9th recital does not concern WTO Members. 
 
Question 10 
 
Has the Commission recognized any countries under th e procedure set out in Article 12(3) of 
Regulation (EC) No. 2081/92?  Have any countries re quested to be recognized under that procedure? 
 22. No (to both questions). 
 
Question 11 
 
Has an application for registration under Regulatio n (EC) No. 2081/92 ever been made in respect of 
the name of a geographical area located out side the EC?  If so, what happened? 
 
23. No. 
 
Question 13 
 
What discretion does the Commission enjoy in the ap plication of Regulati on (EC) No. 2081/92?  
 
24. Whether the provisions of the Regulation leave the Commission a discretion or not, and the 
extent of such discretion, will depend on the word ing of each particular pr ovision conferring powers 
on the Commission. Where such provisions provide th at the Commission "shall" take a certain action, 
the Commission would normally be obliged to take  such action. Where the Regulation provides that 
the Commission "may" take a certain action, then the Commission would normally enjoy a discretion as to whether to take such action or not. In an y case, the Commission is bound to respect and apply 
the terms of the Regulation. WT/DS174/R/Add.2 
Page B-126  
 
  
Question 14 
 
Please express your view on whether and to what  extent the mandatory/discretionary distinction in 
GATT and WTO jurisprudence applies under the TRIPS Agreement.  Would the nature of those TRIPS 
obligations which are not prohibitions but rather oblige Members to take certain actions, affect the 
application of the distinction?   
25. The relevance of the distinction between "m andatory" and "discretionary" measures under the 
TRIPS Agreement is the same as  under the other WTO Agreements. 
 
26. As clarified by the Appellate Body in United States – Carbon Steel (Japan)
8, panels are not 
required, as a preliminary jurisdictional matter, to examine whether the challenged measure is 
"mandatory". Rather, this issue is relevant as part of the panel's assessment of whether the measure is, 
as such, inconsistent with particular obligations. Ac cordingly, whether or not the distinction between 
"discretionary" and "mandatory" measures is "rel evant" under the TRIPS Ag reement will depend on 
the specific obligations imposed by each provision at issue. 
 27. That the distinction between "discretionary" and "mandatory" measures may be relevant also 
under the TRIPS Agreement is illustrated by United States – Section  211, where the Appellate Body 
recalled such distinction and concluded th at the panel had applied it correctly.
9  
 
Question 15 
 
What would be the most authoritative statement of the interpretation of Regulation (EC) No. 2081/92?  
Is a statement by the EC delegation to this P anel legally binding on the European Communities? 
 28. According to Article 220 (1) of the EC Treat y, it is the European Court of Justice which 
ensures that in the interpretation and application of the Treaty the law is observed. This judicial 
function of the Court of Justice also applies to act s of the Community institutions adopted on the basis 
of the Treaty. Accordingly, the highest judicial authority competent to interpret the meaning of 
Regulation 2081/92 is the European Court of Justice. 
 
29. The European Commission represents the Europ ean Community in the proceedings before the 
Panel. Accordingly, the statements made by the ag ents of the European Commission before the Panel 
commit and engage the European Communities.  
30. However, it should also be noted that wher e the statements of the European Communities 
regard the interpretation of Regulation 2081/92, these statements con cern an issue of fact
. These 
statements are made in order to assist the Panel in  its function to make an objective assessment of the 
facts. Their purpose is therefore to clarify the ex isting legal situation in European Community law. 
Their intention is not to create new legal obligatio ns in public international or in Community law. 
 
31. This being said, the EC does not consider that its statements before the Panel are without legal 
significance. In this context, the EC is aware that its  submissions to the Panel will be public as part of 
the final report to the Panel. It is not conceivabl e to the European Commission that it would, in the 
interpretation or application of the Regulation, ta ke a different approach to the one it has set out 
before the Panel.  
 
                                                      
8 Appellate Body Report, United States – Carbon Steel (Japan) , para. 89 
9 Appellate Body Report, United States – Section 211 , para. 258.  WT/DS174/R/Add.2 
 Page B-127 
 
 
 32. As regards the approach to be taken by the European Court of Justice, the European 
Commission considers it important to underline that  the European Court of Justice has shown a 
consistently high degree of awareness and respect fo r the international obligations of the European 
Communities.  
33. According to the settled case law of the Court of  Justice, Community legislation must, so far 
as possible, be interpreted in a manner that is consiste nt with international law, in particular where its 
provision are intended specifically to give effect to an international agreement concluded by the 
Community.
10 
 
34. As one scholar of Community law has observe d in a recent book on the external relations law 
of the European Communities, the principle of c onsistent interpretation has been particularly 
important with respect to GATT and WTO law: "The EU Courts have never hesitated to make use of 
consistent interpretation for the pur pose of applying GATT and WTO law".11  
 
35. As regards specifically the TRIPS Agreement,  the Court for instance has held as follows:12 
 
It is true that the measures envisaged by Article 99 and the relevant procedural rules 
are those provided for by the domestic law of the Member State concerned for the purposes of the national trade mark. However, since the Community is a party to the TRIPs Agreement and since that agreement applies to the Community trade mark, the 
courts referred to in Article 99 of Regu lation No 40/94, when called upon to apply 
national rules with a view to ordering provisional measures for the protection of rights arising under a Community trade mark, are required to do so, as far as possible, 
in the light of the wording and purpose of Article 50 of the TRIPs Agreement. 
36. The Court of Justice will be particularly  prone to take into account the international 
obligations of the Community where the Community legislative act itself indicates that it is intended 
to implement obligations of intern ational law. For instance, in a re cent judgment, the Court held that, 
on the basis of a recital in the Community Anti-Dumping Regulation, the duty to provide an explanation contained in Article 2.4.2 of the AD Ag reement had to apply also in the context of the 
application of the Community Regulation:
13 
 
However, where the Community intended to implement a particular obligation 
assumed in the context of the WTO, or where the Community measure refers expressly to precise provisions of the agreem ents and understandings contained in the 
annexes to the WTO Agreement, it is for the Court to review the legality of the 
Community measure in question in the light  of the WTO rules (see, in particular, 
Portugal v Council, paragraph 49). 
The preamble to the basic regulation, and more specifically the fifth recital therein, 
shows that the purpose of that regulation is , inter alia, to transpose into Community 
law as far as possible the new and detail ed rules contained in the 1994 Anti-dumping 
Code, which include, in particular, those re lating to the calculation of dumping, so as 
to ensure a proper and transparent application of those rules. 
                                                     
 
10 Case C-61/94, Commission/Germany , [1996] ECR I-4006, para. 52 (Exhibit EC-13); C-341/95, 
Bettati , [1998] ECR I-4355, para. 20 (Exhibit EC-14). 
11 Piet Eeckhout, External Relations of the European Union , Oxford University Press, p. 315 (2004). 
12 Case C-53/96, Hermès , [1998] ECR I-3603, para. 28 (Exhibit EC-15); confirmed in C-300/98 and 
392/98, Dior , [2000] ECR I-1344, para. 47 (Exhibit EC-16). 
13 Case C-76/00 P, Petrotub , [2003] ECR I-79, para. 54–57 (Exhibit EC-17). WT/DS174/R/Add.2 
Page B-128  
 
 It is therefore established that the Community adopted the basic regulation in order to 
satisfy its obligations arising from the 1994 Anti-dumping Code and that, by means 
of Article 2(11) of that regulation, it inte nded to implement the particular obligations 
laid down by Article 2.4.2 of that code. To that extent, as is clear from the case-law cited in paragraph 54 of the present judgment, it is for the Court to review the legality 
of the Community measure in question in the light of the last -mentioned provision. 
In that regard, it should be recalled that Community legislation must, so far as 
possible, be interpreted in a manner that is  consistent with international law, in 
particular where its provisions are intended specifically to give effect to an international agreement concluded by th e Community (see, in particular, Case 
C-341/95 Bettati [1998] ECR I-4355, paragraph 20). 
37. The interpretation of Article 12 of Regulati on 2081/92 which the EC has set out before the 
Panel is therefore in full accordance with the prin ciples of interpretation applied on a constant basis 
by the European Court of Justice.  
38. In addition, it also useful to know that the Court of Justice may take account of statements 
which the Commission has made on behalf of the Eu ropean Community in the WTO. For instance, in 
the judgement just cited, the Court of Justice referr ed in support of its inte rpretation to a assurances 
given by the European Commission to the secret ariat of the WTO Committee on Anti-Dumping 
Practices:
14 
 
Such an interpretation coinci des in essence with the intern ational assurances given in 
the communication of 15 February 1996 from the Commission to the secretariat of the WTO Committee on Anti-Dumping Practices , according to which the explanation 
referred to in Article 2.4.2 of the 1994 An ti-dumping Code will be given directly to 
the parties and in regulations imposing anti-dumping duties. 
Question 16 
 
Can the EC provide the Panel with any official st atement predating its first written submission that 
names of geographical areas located in all WTO Members could be registered under Regulation (EC) 
No. 2081/92 without satisfying its equivalence and reciprocity conditions? 
 
39. In the context of the review under Article 24. 2 TRIPS, the EC explained that the reciprocity 
requirement applied without prejudi ce to international agreements.
15 Moreover, in the meeting of the 
TRIPS Council of 16 June 2004, the EC was asked to clarify whether it applied conditions of 
reciprocity and equivalence to other WTO Members.  The EC provided the following response to this 
question:16 
 
EC Regulation No 2081/92 applies to geogr aphical indications relating to areas 
located inside as well as outside the EC.  For this purpose, the Regulation lays down 
rules relating to the registration of geographical indications from outside the EC which closely parallel the provisions app licable to geographical indications from 
inside the EC.  The purpose of these specifi c rules, some of which were recently 
introduced by Regulation No. 692/2003, is to  facilitate the registration of non-EC 
geographical indications while at the same time ensuring that geographical 
                                                     
 
14 Case C-76/00 P, Petrotub , [2003] ECR I-79, para. 59 (Exhibit EC-17). 
15 IP/C/W/253/Rev.1, p. 27 (Exhibit EC-18). 
16 The EC's statement should be reflected in due course in th e minutes of the TRIPS Council.  WT/DS174/R/Add.2 
 Page B-129 
 
 
 indications from outside the EC correspond to the definition of a geographical 
indication. 
As to the conditions which must be fulfille d for registration to take place, some WTO 
Members have considered, on the basis of Article 12(1) of Regulation No 2081/92, 
that registration of geographical indications from outside the EC is possible in only 
under conditions of "reciprocity and equiva lence".  However, Article 12(1) of 
Regulation No. 2081/92 provides that it applies "without prejudice to international agreements" including the TRIPs Agreemen t.  Since WTO Members are obliged to 
provide protection to geographical indi cations in accordance with the TRIPS 
Agreement, the reciprocity and equivalence conditions mentioned in Article 12(1) of 
Regulation 2081/92 do not apply to WTO Members.   
In other words, the EC GI register is open to GIs from other WTO Members, and 
registration of such GIs may take place on the same substantive conditions which 
apply to registration of GIs from EC Member States. 
40. Moreover, the EC would like to remark that  this question concerns evidence regarding the 
interpretation of Regulation 2081/92 as in force at th e time of establishment of the Panel. Regarding a 
question of admissible evidence, the EC does not cons ider that only evidence which predates the date 
of its first written submission in the present proceedi ngs is relevant. For this reason, for instance, the 
statements made by the EC in the course of the Pa nel proceedings should also be taken into account. 
 
Question 17 
 
Is the EC's explanation of the availability of registration of foreign GIs under its system, set out in its 
written statement to the Council for TRIPS in Se ptember 2002, (IP/C/M/37/Add.1, para. 142 and 
Annex, pp. 77-85) consistent with the text of Ar ticles 12-12c of the Regulation?  Why did that written 
statement not qualify the position that the Regul ation's equivalence and reci procity conditions apply 
to foreign GIs, if they did not apply to WTO Members, to whom the statement was addressed? 
 
41. The EC considers that the written statement to  the TRIPS Council is not incompatible with 
the text of Regulation 2081/92 as in force at the time it was made or with the statements of the EC in 
the present case.  
42. The EC would like to remark, however, that th is statement is of limited relevance for the 
present case. It was made in the context of the negotiations for the extension of protection under 
Article 23 TRIPS to products other than wines and spirits. The intention of the statement was 
therefore not primarily to explain the EC system for the protection of geographical indications. In 
addition, the statement was made in 2002, and ther efore does not take into account the amendments 
made by Regulation 692/2003. 
 
Question 18 
 
Did the EC member States agree with the Commission' s written statement to the Council for TRIPS in 
September 2002 with respect to the conditions attached  to the registration of foreign GIs?  How can 
the Commission ensure that the Council of Ministers will not prevent registration under the 
Regulation of the name of a geographical area  lo cated in a third country WTO Member because that 
Member does not satisfy the equivalence and reciprocity conditions of Article 12(1)? 
 
43. It is the European Commission which represen ts the European Commun ities within the WTO. 
Where appropriate, the European Commission consults  with the competent in stances of the Council. 
The position of individual Member States is theref ore of no relevance in the present proceedings. WT/DS174/R/Add.2 
Page B-130  
 
  
44. Like the Commission, the Council of Ministers is bound to apply the terms of Regulation 2081/92. Like the Commission, it is bound to give effect to the wording "without prejudice to international agreements", and to take account of the Community's international 
obligations under the WTO Agreements. 
 
Question 19 
 
Has a judicial authority ever ruled on the availability of protection provided by registration for third 
countries under Regulation (EC) No. 2081/92?  If the Commission registered the name of a 
geographical area located in a third country WTO Me mber, could that registration be subject to 
judicial review because the area was located in a WTO Member that did not fulfil the equivalence and 
reciprocity conditions of Artic le 12(1) of the Regulation? 
 
45. Community courts can only rule on an issu e when concrete cases are brought before them. 
Since no request for registration has ever been ma de in respect of a geographical indication from a 
third country, no judicial authority has ever had the occasion to rule on the availability of protection provided by registration for third countries under Regulation 2081/92.  46. The registration of the name of a geographi cal indication, whether from a third country or 
from within the EC, takes the form of a regula tion of the Commission. The condition under which 
such a regulation can be challenged before the Europ ean Court of Justice are set out in Article 230 of 
the EC Treaty, which reads as follows:  
The Court of Justice shall review the legality  of acts adopted jointly by the European 
Parliament and the Council, of acts of the Council, of the Commission and of the 
ECB, other than recommendations and opinions, and of acts of the European 
Parliament intended to produce legal effects vis-à-vis third parties. 
It shall for this purpose have jurisdiction in  actions brought by a Member State, the 
European Parliament, the Council or the Commission on grounds of lack of competence, infringement of an essential pro cedural requirement, infringement of this 
Treaty or of any rule of law relating to its application, or misuse of powers. 
The Court of Justice shall have jurisdic tion under the same conditions in actions 
brought by the Court of Auditors and by the ECB for the purpose of protecting their prerogatives. 
Any natural or legal person may, under th e same conditions, institute proceedings 
against a decision addressed to that pers on or against a decision which, although in 
the form of a regulation or a decision addr essed to another person, is of direct and 
individual concern to the former. 
The proceedings provided for in this Article shall be instituted within two months of 
the publication of the measure, or of its notif ication to the plaintiff, or, in the absence 
thereof, of the day on which it came to the knowledge of the latter, as the case may be. 
47. The question of the validity of EC regulati ons may also become an issue in proceedings 
before the courts of the Member States. According to Article 234 of the EC Tr eaty, national courts are 
obliged to refer questions concerning the validity of EC regulations to the European Court of Justice 
for a preliminary ruling. Such preliminary ruli ngs are legally binding upon the national courts. 
Article 234 of the EC Treaty provides:  WT/DS174/R/Add.2 
 Page B-131 
 
 
  
The Court of Justice shall have jurisdicti on to give preliminary rulings concerning: 
(a) the interpretation of this Treaty; (b) the validity and interpretation of act s of the institutions of the Community 
and of the [European Central Bank]; 
(c) the interpretation of the statutes of bodies established by an act of the 
Council, where those statutes so provide. 
Where such a question is raised before any court or tribunal of a Member State, that 
court or tribunal may, if it considers that a decision on the question is necessary to enable it to give judgment, request the Court of Justice to give a ruling thereon. 
Where any such question is raised in a case pending before a court or tribunal of a 
Member State against whose decisions there is no judicial remedy under national law, 
that court or tribunal shall bring the matter before the Court of Justice. 
Question 20 
 
With reference to paragraph 43 of the EC's oral st atement, does the EC contest that equivalence and 
reciprocity conditions such as those under Article 12(1) and (3) of Regulation (EC) No. 2081/92, if 
applied to other WTO Members, would be inconsistent with the nationa l treatment obligations in the 
TRIPS Agreement and/or Article III:4 of the GATT 1994?   
48. First of all, the EC considers that this ques tion may be too broad to be answered in abstract 
terms. Since different things may be understood by  "conditions of reciprocity  and equivalence", an 
answer can only be given on a case by case basis. Th is is aptly illustrated by the United States' 
reference to the EC's requirement of inspecti on structures as "equivalence by another name".
17 As the 
EC has already indicated during the first meeting w ith the Panel, it emphatically considers that this 
requirement is not inconsistent w ith the national treatment obligations  of the TRIPS Agreement or the 
GATT. 
 49. As regards the specific conditions contained in Article 12(1) of Regulation 2081/92, the EC 
has already confirmed that it does not apply the se to WTO Members. For this reason, the EC 
considers that the question whether these conditions  are inconsistent with the national treatment 
obligations of the TRIPS Agreement and the GATT does not arise. 
 
Question 21 
 
If Switzerland, as a WTO Member, can apply for registration of its GIs under Regulation (EC) 
No. 2081/92 without satisfying equivalence and reci procity conditions, what was the purpose of its 
joint declaration with the EC concerning GIs set out in Exhibit US-6 and mentioned in paragraph 119 
of the US first written submission and paragraphs 243-244 of the EC's first written submission? 
 
50. The bilateral agreement envisag ed in the declaration represents an alternative approach to the 
protection of geographical indications to the dir ect registration under Regulation 2081/92. Compared 
to the registration on a case-by-case basis, a bila teral agreement would have the advantage that 
protection of the parties' geographical indications  would be obtained in one single act. Moreover, 
                                                     
 
17 Oral Statement of the US at the first substantive meeting of the Panel, para. 17. WT/DS174/R/Add.2 
Page B-132  
 
 possible controversial issues, for instance regard ing generic names, homonyms, or registrations 
concerning cross-border areas, could be resolved in a non-contentious way.  51. However, the declaration is without prejudice to the possibility of applying for protection of 
Swiss geographical indications under Regulation 2 081/92. Accordingly, the envisaged agreement 
merely represents an alternative approach to prot ection which does not exclude direct applications 
under Regulation 2081.  52. Finally, as the EC has already said in its firs t written submission, it would like to recall that 
the declaration is merely a political text, and that  so far no such agreement has been concluded. 
 
Question 22 
 
Are there any legal requirements or other provisions  in EC or national laws  which ensure that groups 
or persons entitled to apply for registration und er Article 5 of Regulatio n (EC) No. 2081/92 are 
always, or usually, EC citizens or  legal persons organized under the la ws of the EC or an EC member 
State?  What conditions have been laid down for nat ural or legal persons to be entitled to apply for 
registration pursuant to Article 5(1)?  
53. There are no such requirements. 
 
54. The conditions subject to wh ich a natural or legal person shall be entitled to apply for 
registration are set out in Article 1 of Commission Regulation 2037/93,
18 which reads as follows: 
 
Applications for registration pursuant to Article 5 of Regulation (EEC) No 2081/92, 
may be submitted by a natural or legal pers on not complying with the definition laid 
down in the second subparagraph of paragraph 1 of that Article in exceptional, duly 
substantiated cases where the person con cerned is the only producer in the 
geographical area defined at the time the application is submitted. 
The application may be accepted only where: (a) the said single person engages in au thentic and unvarying local methods; and 
(b) the geographical area defined possesses characteristics which differ 
appreciably from those of neighbouring areas and/or the characteristics of the product 
are different. 
2. In the case referred to in paragraph 1,  the single natural or legal person who 
has submitted the application for registra tion shall be deemed to constitute a group 
within the meaning of Article 5 of Regulation (EEC) No 2081/92. 
55. These conditions define only the conditions under which a natu ral or legal person, as opposed 
to a group as defined in the second subparagraph of  Article 5 (1) of Regulation 2081/92, may apply 
for registration. As can be seen, these cond itions have nothing to do with nationality. 
 
                                                     
 
18 Exhibit COMP-2.  WT/DS174/R/Add.2 
 Page B-133 
 
 
 Question 23 
 
How do you interpret the term "nationals" as used in Article 1.3, including footnote 1, and 
Articles 3.1 and 4 of the TRIPS Agreement and Article 2 of the Paris Convention (1967) in relation to 
this dispute?  Do a Member's nationals necessarily  include natural persons  who are domiciled, or 
legal persons who have a real and effective indus trial and commercial establishment, in that 
Member?  
56. As regards the definition of nationals in Article 3.1 and 4 of the TRIPS Agreement and 
Article 2.1 of the Paris Convention, a distinction mu st be made between natu ral and legal persons. For 
natural persons, a national is an y person who holds the nationality of the State in question in 
conformity with the legislation of such state. As regards legal persons, the question of nationality 
depends on the law of the state in question, which may use criteria such as the law of incorporation, 
headquarters, or other criteria. The legal situ ation has been summed up by Bodenhausen in his 
commentary to Article 2.1 of the Paris Convention as follows:
19 
 
In deciding the question who are such nationa ls, account has to be taken of the fact 
that the Convention can also apply to legal persons or entities , so that a distinction 
must be made between the nationality of natural and legal persons, respectively. 
With respect to natural persons, nationality is a quality  accorded or withdrawn by the 
legislation of the State whose nationalit y is claimed. Therefore it is only the 
legislation of that State which can defi ne the said nationality and which must be 
applied also in other countries where it is invoked. 
With respect to legal persons, the question is more complicated because generally no 
"nationality" as such is granted to legal pe rsons by existing legislations. Where these 
legal persons are the States themselves, or State enterprises, or other bodies of public 
status , it would be logical to accord to them the nationality of their country. With 
regard to corporate bodies of private status , such as companies and associations, the 
authorities of the countries where application of the Convention is sought will have to 
decide on the criterion of "nationality" whic h they will employ. This "nationality" can 
be made dependent upon the law according to which these legal persons have been 
constituted, or upon the law of their actual headquarters, or even on other criteria. 
Such law will also decide whether a legal person or entity really exists. 
57. Natural persons who are merely domiciled in a St ate, but are not nationals of that state, are 
not "nationals" within the meaning of the nationa l treatment provisions of the TRIPS Agreement and 
the Paris Convention. Similarly, legal persons who have a real and effective industrial and 
commercial establishment in a State, but do not fulfil  the conditions for nationality of such state, are 
not nationals of such state. Domicile and establishment can therefore not simply be equated with 
"nationality" within the meaning of the national tr eatment provisions of the TRIPS Agreement and the 
Paris Convention.  58. That nationality on the one hand, and domic ile or establishment on the other hand, are not 
identical concepts also follows fro m the context of the Paris Convention. First of all, if all persons 
domiciled or established in a partic ular State were its nationals, th en the separate prohibition on 
conditions of domicile or establishment in Article 2. 2 of the Paris Convention would be devoid of all 
useful purpose.   
                                                     
 
19 Bodenhausen, Guide to the Application of the Paris Convention for the Protection of Industrial 
Property, p. 27-28 (1968). WT/DS174/R/Add.2 
Page B-134  
 
 59. More importantly still, Article 3 of the Paris Convention enlarges the national treatment 
obligation to "nationals of countries outside the Union who are domiciled or who have real and 
effective industrial or commercial est ablishments in the territory of one of the countries of the Union". 
This provision would be completely unnecessary if all residents of a member of the Union were in any event to be considered as its nationals, and therefore benefited from national treatment under 
Article 2.1 of the Paris Convention. Article 3 of th e Paris Convention therefore clearly illustrates that 
the Paris Convention, and similarly also the co rresponding provisions of the TRIPS Agreement, 
regard nationality as a concept different from domicile or residence.  60. Finally, this is also illustrated by footnote 1 to Article 1.3 of the TRIPS Agreement. This 
footnote defines nationals, in the case of a sep arate customs territory which is a WTO Member
, to 
mean persons natural or legal w ho are domiciled or who have a real and effective industrial or 
commercial establishment in that customs territo ry. This definition was necessary since separate 
customs territories are not states, and therefore normally do not have "nationals". Thus, the criterion of residence or establishment is used here as a replacement for the criterion of nationality, which 
cannot apply to separate customs territories. In turn , this special definition for custom territories 
would have been unnecessary had this been already the normal meaning of "nationality". Once more, 
footnote 1 to Article 1.3 proves that nationality and residence or establishment are not identical concepts under Articles 3.1 and 4 TRIPS and 2.1 Paris Convention. 
 
Question 24 
 
In your view, which natural or legal persons c an be considered "interested parties" in the sense of 
Article 22.2 of the TRIPS Agreement?  Is Article  10(2) of the Paris Convention (1967) relevant? 
 
61. The notion of "interested parties" must be de fined in relation to the intellectual property rights 
that Article 22.2 seeks to protect. Article 22.2 is included in Section 3 of Part II of the TRIPS 
Agreement dealing with "Geographical Indications " and is entitled "Protection of geographical 
indications". Moreover, the introductory phrase of Ar ticle 22.2 provides that the obligation set out in 
that provision apply "in respect of geographi cal indications". Accordingly, for purposes of 
Article 22.2, "interested parties" are those whic h can claim an interest in the protection of a 
geographical indication, and not of other intellect ual property rights, such as, for example,  a  
conflicting trademark.  
 62. The definition of "interested parties" in Ar ticle 10(2) of the Paris Convention does not apply 
to Article 10bis, which is the only provision of the Paris Convention referred to  in Article 22.2 of the 
TRIPS Agreement. Nor should Article 10bis be extra polated by way of contextual interpretation to 
Article 22.2. Article 10bis is concerned with fal se "indications of source", a notion which is much 
broader than that of geographical indications, as defined in Article 22.1 of the TRIPS Agreement. 
 63. Without prejudice to the above, the EC reca lls that Regulation 2081/92 grants to "any 
legitimately concerned le gal or natural person"
20 the right to object to the registration of a 
geographical indication. The EC considers that  this wording is broad enough to encompass all 
"interested parties", as defined in Article 10bis of the Paris Convention. 
 
                                                      
20 Cf. Article 7(4).  Equivalent wording is used in Articles 12b(2) and 12d(1), which confer a right of 
objection to any legal or natural person with a "legitimate interest".   WT/DS174/R/Add.2 
 Page B-135 
 
 
 Question 25 
 
Is it appropriate to compare nationals who are int erested in GIs that refer to areas located in 
different WTO Members in order to  examine national treatment under the TRIPS Agreement?  Why or 
why not? 
 64. The EC is not entirely certain that it understa nds the meaning of the phrase "nationals who are 
interested in GIs that refer to areas located in  different WTO Members" in the present context. 
However, the EC would like to recall that nationa l treatment under the TRIPS requires a comparison 
as between domestic a nd foreign nationals
 who are otherwise in the same situation. 
 
Question 26 
 
If national treatment can be examined in relation to  GIs in terms of the location of the geographical 
area to the territory of a Member, is it appropriate to examine nati onal treatment in relation to any 
other intellectual property rights in terms of an atta chment to a Member besides the nationality of the 
right holder?  Why or why not?  
65. The EC would once again like to stress that th e term "nationality" in Articles 3.1 and 4 TRIPS 
and 2.1 Paris Convention is not linked to an attachment to the territory of a Member.  
66. Moreover, the EC would like to stress that the term "national" must be given a uniform 
meeting regardless of which intellectual property right  is concerned. It is incontestable that in 
accordance with Article 22.1 TRIPS, geographical indications are characterised by a link with a particular geographical area. However, this link, wh ich is an inherent part of the definition of a 
geographical indication, provides no justification for defining the term "national" in Articles 3.1 and 4 
TRIPS and 2.1 Paris Convention differently wh en geographical indications are concerned. 
 
Question 29 
 
The Japan - Alcoholic Beverages II, Korea - Al coholic Beverages and Chile - Alcoholic Beverages 
disputes show that measures which are origin-neutral on their face can be incons istent with Article III 
of GATT 1994.  Is Regulation (EC)  No. 2081/92 also open to challenge  under Article 3.1 of the TRIPS 
Agreement despite its apparently national-neutral text?  
 
67. The EC notes that the disputes Japan - Alcoholic Beverages II , Korea - Alcoholic Beverages 
and Chile - Alcoholic Beverages all concerned tax measures which were found to be incompatible 
with Article III:2 of the GATT. 
 68. The EC considers that this jurisprudence concerning the interpretation of Article III:2 of the 
GATT is not relevant for the present dispute. Artic le III:2 GATT is a provision dealing specifically 
with national treatment as regards internal taxes or other internal charges. As the Appellate Body has 
stated in EC – Asbestos , there are important textual and struct ural differences between Articles III:2 
and III:4 of the GATT. Accordingly, the Appellate  Body found for instance that the term "like 
products" in Article III:4 GATT could not be interprete d in the same way as the same term in the first 
sentence of Article III:2 GATT.
21 
 69. These findings of the Appellate Body conf irm that national treatment provisions cannot 
simply be assumed to have the same scope and meani ng, but must be interpreted on the basis of their 
specific wording and context. If this already app lies between two paragraphs  of Article III GATT, 
                                                     
 
21 Appellate Body Report, EC – Asbestos , para. 94-96. WT/DS174/R/Add.2 
Page B-136  
 
 even more caution is necessary when attempting to transpose national treatment principles from one 
agreement to another.  70. As the Panel in Canada – Pharmaceutical Patents has convincingly explained, there is 
therefore no general concept of discrimination which would be common to all WTO Agreements. 
Rather, the meaning of each provision prescribing equal treatment must be established on the basis of 
the precise legal text in issue:
22 
 
In considering how to address these conflicti ng claims of discrimination, the Panel 
recalled that various claims of discrimination, de jure  and de facto, have been the 
subject of legal rulings under GATT or th e WTO.  These rulings have addressed the 
question whether measures were in conf lict with various GATT or WTO provisions 
prohibiting variously defined forms of discr imination.  As the Appellate Body has 
repeatedly made clear, each of these rulings  has necessarily been based on the precise 
legal text in issue, so that it is not possibl e to treat them as applications of a general 
concept of discrimination.  Given the ve ry broad range of issues that might be 
involved in defining the word "discrimin ation" in Article 27.1 of the TRIPS 
Agreement, the Panel decided that it would be  better to defer attempting to define that 
term at the outset, but instead to determin e which issues were raised by the record 
before the Panel, and to define the con cept of discrimination to the extent necessary 
to resolve those issues. 
71. The EC would suggest that such a case-speci fic approach would also be appropriate in the 
present case. In this context, the EC would not ex clude entirely that under certain circumstances, 
measures which are neutral on their face may nonetheless constitute less favourable treatment of foreign nationals. However, the EC would suggest that when considering whether Regulation 2081/92 
involves discrimination as between nationals within the meaning of Article 3.1 TRIPS and 2.1 of the 
Paris Convention, the Panel should also ta ke account of the following considerations: 
 72. First, Article 3 TRIPS refers  to nationals. This specific reference, which differs from Art III:4 
GATT, must be given meaning. For this reason, it should not be argued that because a measure 
involves discrimination on the basis of the origin of  a good, or of domicile and establishment, it also 
constitutes de facto discrimination of nationals, since such discrimination is already covered by 
Article III:4 GATT, or Article 2.2 of the Paris Convention.  
 73. Second, the Appellate Body has held repeatedly that de facto discrimination is a notion 
intended to prevent circumvention of national treatment obligations.
23 Such a risk does not exist if a 
specific issue is already dealt with in other nationa l treatment provisions, such as those of the GATT. 
 
74. Third, the national treatment provisi ons of the TRIPS and the GATT should not 
systematically overlap. The Panel must also take account the different legal context of the provisions, 
which are contained in different agreements. For ex ample, the Panel would have to consider whether 
Articles XX and XXIV GATT, which are available as defenses against national treatment claims under the GATT, could also apply under the TRIPS Ag reement. This is an issue of major systemic 
implications, which should be ta ken into account in the interpre tation of the national treatment 
provisions of the TRIPS Agreement.  
                                                     
 
22 Panel Report, Canada - Pharmaceutical Patents , para. 7.98 (footnotes omitted). 
23 Cf. Appellate Body Report, EC – Bananas III , para. 233; Appellate Body Report, Canada – Autos , 
para. 142.  WT/DS174/R/Add.2 
 Page B-137 
 
 
 Question 30 
 
In Article 2(1) of the Paris Convention (1967) as incorporated in the TRIPS Agreement by its 
Article 2.1, should the words "country of the Uni on" be read mutatis mutandis to refer to "WTO 
Member"?  
 75. Yes. 
 
Question 31 
 
What is the respective scope of the national treatm ent obligations in Article 2(1) of the Paris 
Convention (1967) and Article 3.1 of the TRIPS Agreement?  Do they overlap?  
76. The scope of the national treatment obligations in Article 2(1) of the Paris Convention (1967) 
and Article 3.1 of the TRIPS Agreement must be derived from the precise wording of those 
provisions. Given the closely parallel wording of th e two provisions, it appears to the EC that they 
overlap to a considerable extent.  
Question 33 
 
Is there a public policy requirement specific to GI s which underlies the requirement that a group or 
person must send a registration application under Regulation (EC) No. 2081/92 to the EC Member 
State or authorities of a third country in which the geographical area is located, rather than directly 
to the Commission?  
77. The requirement that a group or person must send a registration application to the EC Member State or authorities of a third country in  which the geographical area is located reflects the 
important role that Member  States or third country authorities play in the registration process under Regulation 2081/92.  78. According to Article 5 (5) of Regulation 2 081/92, the Member State shall check that the 
application is justified and shall forward the app lication, including the product specification referred 
to in Article 4 and other documen ts on which it has based its decision, to the Commission. In a recent 
judgment, the European Court of Justice has explaine d that this role of Member States is due in 
particular to the detailed knowledge of Member Stat es in respect of geographic indications relating to 
their territory:
24 
 
It follows that the decision to register a designation as a PDO or as a PGI may only be 
taken by the Commission if the Member State concerned has submitted to it an application for that purpose and that such an application may only be made if the 
Member State has checked that it is justified. That system of division of powers is attributable particularly to the fact that registration assumes that it has been verified 
that a certain number of conditions have been  met, which requires, to a great extent, 
detailed knowledge of matters particular to the Member State concerned, matters 
which the competent authorities of th at State are best placed to check. 
79. These same considerations are also underlyi ng the requirement in Article 12a (2) of the 
Regulation, according to which the third country  must verify that the requirements of the 
Regulation are verified before it transmits the applic ation. Indeed, the need for an involvement of the 
national authorities appears even more compelling when the application concerns a geographical 
indication from a third country rather than from a Member State. 
                                                     
 
24 Case C-269/99, Karl Kühne , [2001] ECR I-9517, para. 53 (Exhibit EC-19). WT/DS174/R/Add.2 
Page B-138  
 
  
80. First, the evaluation of whether a name fulf ils the conditions for protection as a geographical 
indication requires familiarity with a host of geogr aphical, natural, climatic and cultural factors 
specific to the geographical area in question. More over, knowledge of the market conditions in the 
country of origin may also be required, e.g. in order to establish whether the product in question has a 
particular reputation. Like in the case of applications from Member State, it is the third country's 
authorities which are best placed to evaluate such factors. In contrast, the European Commission is 
less likely to be familiar with such  factors than in the case of an ar ea in a Member State. Moreover, 
the evaluation may also require knowledge of the lan guage of the third country in question, which the 
authorities of the European Community may not have. 
 
81. Second, the evaluation of the application may require the assessment of legal questions 
arising under the law of the country where the area is located. In particular, Article 12a of the 
Regulation requires the application to be accompanie d by a description of the legal provisions and the 
usage on the basis of which the geographical indicati on is protected or established in the third country. 
The Commission cannot unilaterally resolve such i ssues pertaining to the law of a third country, 
which therefore necessarily require the implica tion of the authorities of the third country. 
 82. Third, the involvement of the third country government appears called for also out of respect 
for the sovereignty of the third country. The assessment of whether an application meets the 
requirements of the Regulation, in particular con cerning the link with the geographical area, requires 
in-depth knowledge of the conditions related to this  area, as well as the possibility to verify on the 
spot the relevant claims made in the applica tion. It would not be possible for the European 
Commission to carry out such inspections on the territory of the third country without the agreement or involvement of the third country.  
83. Fourth, the involvement of the third country government also facilitates the cooperation of the 
authorities of the Community and of the third country throughout the registration process. If doubts or question arise during the registration process, the European Commission may need a contact point in the third country to which it can address itself. Moreover, the Regulation foresees that the third 
country which has transmitted the application must be consulted at certain stages of the procedure 
before the Commission can take a decision (cf. Articles 12b [1] [b]; 12b [3]). 
 
84. Fifth, the involvement of the third country authorities should also be beneficial to the applicant. Regulation 2081/92 effectively enables th e applicant to discuss, prepare, file, and where 
necessary refine and amend his application directly with the authorities where the geographical area is 
located. Since these authorities are mo re familiar with the area in question, this should help speed up 
the registration process. Moreover, frequently thes e authorities may be geographically closer to the 
applicant and may speak the applicant's language, which may also be a further benefit to the applicant.  
 
Question 34 
 
Is there a public policy requirement specific to GI s which underlies the requirement that a person 
wishing to object to a registration under Regulation (EC) No. 2081/92 must send an objection to the 
EC Member State or authorities of a third country in which he resides or is established, rather than 
directly to the Commission?  
85. Article 12d(1) requires any natural or legal pers on that has a legitimate interest and is from a 
WTO Member Country to transmit a duly substantiate d statement to the country in which it resides or 
is established, which shall transmit it to the Commission.  86. It is to be noted that under this provision, the third country is not required to verify the 
admissibility of the objection on the basis of the criter ia laid down in Article 7(4) of the Regulation.  WT/DS174/R/Add.2 
 Page B-139 
 
 
 Accordingly, the transmission of such applications does not require the same degree of verification as 
the transmission of applications for registration, a nd should therefore not be particularly burdensome 
for third countries.  87. Despite this somewhat less important role of third countries in the transmission of statements 
of objection, some degree of involvement of the th ird country government remains necessary. First, it 
is necessary to verify whether the person objecting is indeed resident or established in the third 
country, which is only possible for the authorities of th at country. Second, it is not excluded that in the 
further procedure, questions relating to the territory of the third country might arise, in which case it is 
useful for there to be an official contact point in the third country. Third, it should also be beneficial to 
the person making the objection to be able to deal dir ectly with an authority in the country where it is 
resident or established. Finally, if a statement of  objection is admissible, Article 12d (3) provides that 
the third country which has transmitted the statemen t of objection is to be  consulted before the 
Commission takes its decision.  Question 35 
 
Has an objection to the registration of a name u nder Regulation (EC) No. 2081/92 ever been filed by 
a person from a third country?  If so, what happened?   
88. No.  
Question 37 
 
Please indicate examples of other international a rrangements, such as the Madrid Protocol, under 
which national governments cooperate by acting as agents or intermediaries in the protection of 
private rights.  Which of these arrangements are established under international treaties and which 
under the legislation of one of the parties to the arrangement?  Which are relevant to the matter 
before the Panel?  
89. There are a large number of examples in in ternational law and prac tice in which national 
governments cooperate by acting as agents or intermed iaries in the protection of private rights. Given 
the limited time available, the EC will limit itself to providing some examples drawn from a number 
of different sectors.  90. As referred to by the Panel, a first example is already provided by Article 2 (2) of the Protocol 
to the Madrid Agreement concerning the internati onal registration of trademarks (Exhibit EC-20), 
which reads as follows: 
 
The application for international registra tion (hereinafter referred to as "the 
international application") shall be filed with the International Bureau through the 
intermediary of the Office with which the b asic application was filed or by which the 
basic registration was made (hereinafter refe rred to as "the Office of origin"), as the 
case may be. 
91. Similar examples where the protection of an intellectual property right requires action of the 
home country of the right holder can also be fou nd in other agreements. For instance, Article 6 
quinquies A (1) of the Paris Convention provides th at Members of the Union may require, before 
registering a trademark duly registered in the count ry of origin, a certificate of registration in the 
country of origin, issued by the competent authority. 
 WT/DS174/R/Add.2 
Page B-140  
 
 92. Similarly, Article 5(1) of the Lisbon Agreem ent for the Protection of Appellations of Origin 
(Exhibit EC-21) provides that applications for the registration of appellations of origin must be 
requested by the offices of the countries of the Special Union:  
The registration of appellations of origin sha ll be effected at the International Bureau, 
at the request of the Offices of the countries of the Special Union, in the name of any 
natural persons or legal entities, public or private, having, according to their national 
legislation, a right to use such appellations. 
93. Such examples for requirements for coopera tion between governmental authorities can also 
be found outside the area of intellectual propert y protection. For instance, the Specific Annex on 
Origin to the International Convention on the Simplification and Harmonisation of Customs 
Procedures (Kyoto Convention) provides that in certa in cases, a certificate of origin issued by the 
competent authorities of the country of origin may be required.
25 Moreover, the Specific Annex also 
provides that in certain cases, the customs aut horities of the importing party may request the 
competent authorities of the party where the certifi cate of origin has been established to carry out 
controls.26 
 94. Further examples can be found in the field of technical standards and conformity assessment. 
For instance, the EC has concluded mutual rec ognition agreements with both the United States and 
Australia. Under these agreements, the parties mu tually recognize the results of conformity 
assessment carried out by conformity assessment bodies recognized under the agreement. Each party 
designates its conformity assessment bodies to be recognized under the agreement.
27 Moreover, each 
party remains responsible for monitoring the c onformity assessment bodies which it has designated.28 
 95. Similar arrangements can be found in the field of transport. According to Article 31 of the 
Chicago Convention on International Civil Aviatio n (Exhibit EC-25), every aircraft engaged in 
international navigation shall be provided with a certificate of airworthiness issued or rendered valid 
by the State in which it is registered. Similarly,  according to Article 32 of the Chicago Convention, 
the pilot of every aircraft and the other members of the crew of every aircraft engaged in international civil aviation shall be provided with certificates of  competency and licences issued or rendered valid 
by the State in which the aircraft is registered.  
96. Another example can be drawn from the field of  fisheries. In accordance with Article 62 of 
the UN Convention on the Law of the Sea, bilateral ag reements may give other states access to fishing 
resources in the exclusive economic zone of a coastal  state. However, the applications for fishing 
licenses must usually be transmitted by the authorities of  the fishing state to those of the coastal state. 
By way of example, reference can be made to the Annex of the bilateral fisheries agreement between 
the European Community and Mozambique (Exhibit EC-26), which provides the following: 
 
The procedure to be followed in appl ying for and issuing licences authorising 
Community vessels to fish in Mozambican waters shall be as follows: 
(a) for each vessel, the European Commission, acting via its representative in 
Mozambique and through the agency of its delegation in that country, shall submit to 
the Mozambican authorities a licence a pplication drawn up by the vessel owner 
                                                     
 
25 Specific Annex K to the Kyoto Convention, pts. 2 to 5, 9-12 (Exhibit EC-22). 
26 Appendix III to Specific Annex K to the Kyoto Convention, pt. 3 (Exhibit EC-22). 
27 Cf. Article 7 of the Agreement with the United St ates (Exhibit EC-23); Article 5 of the Agreement 
with Australia (Exhibit EC-24). 
28 Cf. Article 10 of the Agreement with the United St ates (Exhibit EC-23); cf. also Article 8 of the 
Agreement with Australia (Exhibit EC-24).  WT/DS174/R/Add.2 
 Page B-141 
 
 
 wishing to carry on fishing activities under this Agreement; the application shall be 
submitted no later than 25 days before th e start of the validity period mentioned 
therein. Applications shall be made us ing the forms provided for this purpose by 
Mozambique, specimens of which are give n in Appendix 1 for tuna seiners and 
longliners, and in Appendices 1 and 2 fo r freezer bottom trawlers. They shall be 
accompanied by proof of payment of the advance payable by the vessel owner;  
97. Finally, examples can also be found in the field of judicial cooperation in civil and 
commercial matters. For instance, Article 3 of the Hague Convention on the Service Abroad of 
Judicial and Extrajudicial Documents in Civil or  Commercial Matters (Exhibit EC-27) provides as 
follows: 
 
The authority or judicial officer competen t under the law of the State in which the 
documents originate shall forward to the Ce ntral Authority of the State addressed a 
request conforming to the model annexed to the present Convention, without any 
requirement of legalisation or  other equivalent formality. 
98. Finally, the EC would like to recall that it is a common feature of customary international law 
that states act on behalf of their nationals and their rights and interest . This is most clearly recognized 
in the institution of diplomatic protection, on the b asis of which states may raise claims against other 
states on the basis of injury suffered by the national of the claiming state.29 
 99. That fact that most of the examples above  are drawn from international agreements does not 
diminish their relevance for the present case. Rather , these examples illustrate that in an increasingly 
interdependent world, the effective protection of i ndividual rights in cross-border situations inevitable 
engenders a need for cross-border cooperation.  100. The EC considers that the examples quoted above are merely a fraction of the cases where 
intergovernmental cooperation occurs in the cross- border protection of individual rights. The EC 
reserves the right to elaborate further on this questi on in the later stages of the procedure. However, at 
this stage, the EC would like to remark that th e Panel should be mindful that the claims of the 
complainants may have implications that go far beyond the present case.  
Question 39 
 
Does an EC member State participate in decision-making on a proposed registration either in the 
Committee established under Article 15 of Regula tion (EC) No. 2081/92 or in the Council of 
Ministers, where that EC member State transm itted the application or an objection to it to the 
Commission?  Is the EC member State identified with the applicant or person raising the objection in 
any way?  Are there any limits on the participation of the EC member State - for instance, can it 
object to an applica tion which it transmitted? 
 
101. The Committee assisting the Commission in accordance with Article 15(1) of 
Regulation 2081/92 is composed of  representatives of all Member States. This includes also the 
Member State which has transmitted the application or the statement of objection. 
 
102. As the EC has already explai ned in its first written submission,
30 the constitution of regulatory 
committees is a typical modality under which the Counc il of Ministers delegates regulatory powers to 
                                                      
29 Cf. Diplomatic Protection of Foreign Nationals, in: Encyclopaedia of Public International Law, 
Vol. 1, p. 1067 (1992). 
30 EC, FWS, paras. 79 to 83. WT/DS174/R/Add.2 
Page B-142  
 
 the European Commission. Regulatory committees such as the one foreseen in Article 15(1) of 
Regulation 2081/92 are therefore an integral part of the Community's constitutional system. 
 103. When fulfilling their functions under Regula tion 2081/92, a Member State is in no way 
identified with the applicant or the person raising the objection. In verifying the applications or 
statements of objection, the Member State must co rrectly, impartially and objectively apply the terms 
of the Regulation. Similarly, when exercising its role in the Committee, the Member States must be 
guided by the terms of the Regulation, and not act  as a representative of any individual applicant or 
objecting person.  
104. It should be noted that already when examining the admissibility of an application, the 
Member State must take into account all objections  from within its own country, and resolve these 
before transmitting the application. The situation e nvisaged in the last sente nce of the question can 
therefore not occur. This has been clarified in a recent judgment of the European Court of Justice:
31 
 
In this connection, it should be observed that it follows from the wording and the 
scheme of Article 7 of Regulation No 2081/92 that a statement of objection to a registration cannot come from the Memb er State which has applied for the 
registration and that the objection procedure established by Article 7 of that regulation is not therefore intended to settle  disputes between the competent authority 
of the Member State which has applied for registration of a designation and a natural 
or legal person resident or established in that Member State. 
Question 40 
 
How many applications to register names under Regulation (EC) No. 2081/92 have been considered 
by the Committee established under Article 15 of the Regulation or the Council of Ministers? 
 105. Under the simplified procedure foreseen in Article 17 of Regulation 2081/92 as applicable 
until its amendment through Regula tion 692/2003, the consultation of the Committee was required in 
all cases. A number of these applications were al so, for various reasons, referred to the Council.  
 106. As regards the normal procedure, out of 171 ap plications, only a small number (10) have been 
considered by the Committee. Non of these cases was referred to the Council. 
 107. For the convenience of the Panel, the EC subm its as Exhibit EC-28 a table which sets out in 
more detail the different cases of consultation of the Committee and referral to the Council. 
 Question 41 
 
In paragraph 137 of your first written submission, you indicate t hat the term "such names" in the 
second sub-paragraph of Article 12(2) of Regulation (EC) No. 2081/92 is a reference to the first sub-
paragraph of Article 12(2), and that th is means that the requirement to indicate the country of origin 
applies where "a protected name of a third country is  identical to a Community protected name".  
Please clarify the meaning of the following terms, as used in Article 12(2) of Regulation (EC) 
No. 2081/92:   (a) what is the meaning of the term "prot ected" in the phrase "a protected name of a 
third country"? 
 
                                                     
 
31 Case C-269/99, Karl Kühne , [2001] ECR I-9517, para. 55 (Exhibit EC-19).  WT/DS174/R/Add.2 
 Page B-143 
 
 
 108. Both in "protected name of a third country"  and in "Community protected name", "protected" 
in principle means "protected under Regulation 2081 /92". However, the provision also applies where 
protection under Regulation 2081/92 is sought for a protected name from a third country. 
 
 (b) does the phrase "a Community protect ed name" cover both names of geographical 
areas located in the EC as well as in third countries, registered under the 
Regulation? 
 
109. No. "Community protected name" covers onl y protected names of areas located in the EC. 
  (c) does the requirement to indicate the c ountry of origin apply also where a name of a 
geographical area located in the EC is identical to a Community protected name 
(irrespective of whether this Community protected name is the name of a geographical area located in the EC or in a third country).  
 110. No. "Community protected name" covers only protected names of areas  located in the EC. 
Moreover, the provision applies only to protected names.  
Question 42 
 
If Article 12(2) of Regulation (EC) No. 2081/92 applies to the registration of a name of a 
geographical area located in the EC that is identical  to a name, already registered in the EC, of an 
area located in a third country, what is the differen ce in its scope compared to Article 6(6) of the 
Regulation?  Why is it necessary to cover this situation in both provisions? 
 
111. Article 12(2) is a specific  provision dealing with certain cases of conflicts between 
homonyms which may arise between Community and thir d country protected names. Article 6(6) is a 
more general provision dealing with a wider set of  conflicts, and notably conflicts between homonyms 
from within the Community, but including also conflicts involving third country names not yet resolved by Article 12(2), for instance between nam es from within the same third country, or between 
third countries.  Question 43 
 
Where does Regulation (EC) No. 2081/92 provide for the registration of a name of a geographical 
area located in a third country WTO Member whic h is a homonym of an alre ady registered name?  
Where does it provide for the registration of a nam e which is a homonym of an already registered 
name of a geographical area located in a third country WTO Member? 
 
112. As regards the first question, if the already registered name is a name from the Community, 
this situation would be covered by Article 12(2) of Regulation 2081/92. As regards the second 
question, if the name to be registered is from th e Community, this situation would equally be covered 
by Article 12(2). 
 
Question 44 
 
Can the EC provide the Panel with any official st atement predating its first written submission that 
Article 12(2) of Regulation (EC) No. 2081/92 applie s to names of geographical areas located in the 
EC and that Article 12(2) will be applied on the basis of the date of registration? 
 
113. No. The EC would like to remark that sin ce there have been no cases of application of 
Article 12(2) so far, the EC has not felt a need to make official statements as regards the application 
of this provision. WT/DS174/R/Add.2 
Page B-144  
 
  
Question 45 
 
With respect to paragraph 135 of the EC's first written submission, could the Council of Ministers 
prevent a registration because the Commission applie d Article 12(2) to names of geographical areas 
located in the EC on the basis of the date of registration? 
 
114. No. As the Commission, the Council is bound by law to apply the terms of 
Regulation 2081/92.  Question 46 
 
Has a judicial authority ever ruled on the applic ability of Article 12(2) of Regulation (EC) 
No. 2081/92?  If the Commission applied Article 12(2) to the name of a geographical area located in the EC on the basis of the date of registration, coul d that action be subject to judicial review due to 
the fact that the area was located in the EC? 
 
115. Since Article 12(2) has never been applied, no judicial authority has ever had the occasion to 
interpret this provision.  116. Any Commission decision regarding the regist ration of a geographical indication can be the 
subject of judicial review under the conditions to  which the EC has referred in its response to 
Question 19.
32 
 
Question 49 
 
Do you seek separate rulings on the procedural aspects of Regulation (EC) No. 2081/92 or a ruling 
on the Regulation as a whole?  For example, shoul d the provision in Article 12(2) be examined in 
isolation, or would it be appropr iate to adopt an approach like the Panel in Korea – Beef, which only 
examined a display sign requirement within its findings related to a system as a whole?  
117. In accordance with Article 3.7 of the DSU, th e purpose of the present proceedings is to secure 
a positive solution to the dispute. In the view of  the EC, securing a positive solution to the dispute 
requires the Panel to address all the claims which have  been raised by the co mplainants with respect 
to particular aspects of Regulation 2081/92.  118. Moreover, Article 19.1 of the DSU provides th at where a Panel concludes that a measure is 
inconsistent with a covered agreement, it sha ll recommend the Member concerned to bring the 
measure in conformity. The Panel's recommendations  are the basis for implementation in accordance 
with Article 21 of the DSU. In order to enable  the Member to properly implement the Panel's 
recommendations, it is therefore essential that a Panel's recommendation be as specific and clear as possible.  
119. For this reason, if the Panel came to the conclusion that certain aspects of Regulation 2081/92 
are inconsistent with a covered agreement, it w ould be necessary that these aspects be specifically 
identified in the Panel's conclusions and recomme ndations in order to enable the EC to duly 
implement the report.  
                                                     
 
32 Above para. 46 et seq.  WT/DS174/R/Add.2 
 Page B-145 
 
 
 Question 50 
 
In paragraph 451 of its first written submission,  the EC argues that labels which address the 
geographical origin of a product cannot be considered a technical regulation under the TBT 
Agreement, since they do not apply to a "product, process or production method".  Why in the EC's 
view is the geographical origin of a product not rel ated to that product or its process or production 
method?  Does the coverage of the TBT Agreement with respect to labels depend on the content of the 
labels?  
120. First of all, the EC would like to recall that  Article 12(2) is not a labelling requirement, but 
merely sets out the conditions under which geographical  indications can be registered in the case of 
homonymous protected names from the EC and from a third country.   121. Second, it is clear that the origin of a product is not a "process or production method". The 
question can therefore only be whether the indi cation of the country of origin is a labelling 
requirement as it relates to a product. However, it see ms to the EC that the origin of a product is 
different from the product itself.   122. Of course, the origin of a product may confer  specific characteristics or a reputation on it, 
which may entitle it for protection as a geographical indication. However, these issues are already 
covered in the TRIPS, and do therefore not need to be addressed by the TBT Agreement. Moreover, 
as the EC has already remarked, the question of or igin marking is already covered by the special 
disciplines of Article IX GATT.
33 
 
Question 51 
 
How should the term "like products" be interpreted under Article 2.1 of the TBT Agreement?  If the 
labelling requirement in Article 12(2) of Regulation (EC) No. 2081/92 applies to situations where 
identical names arise between imported products and EC products, but does not apply to situations 
where identical names arise between two EC products , to what extent would this be a distinction 
between "like situations" rather than a distinction between "like products"? 
 
123. The EC agrees that Article 2.1 TBT Agre ement requires a comparison between like products, 
not between "like situations". In the view of the EC, Australia has not shown that homonymous 
products from within the EC covered by Article 6 (6 ) of the Regulation would in any sense be "like" a 
third country product which is covere d by Article 12(2) of the Regulation. Accordingly, Australia has 
failed to establish any claim under Article 2.1 TBT Agreement. 
 124. Moreover, the EC considers that under Australia 's argument, the two situations are not even 
like. In fact, the comparable situation to two homonymous EC GIs protected under Regulation 2081/92 would be that of two homonym ous Australian GI's protected under Australian 
law. This is obviously not a situation which can give  rise to discrimination between Australian and EC 
products. In fact, as the EC has already stated, it does not understand how Australian products could 
be affected by the way in which conflicts between homonymous names from within the EC are resolved.  125. Since Australia has in any case failed to establish a case under Article 2.1 TBT Agreement, 
the EC considers that the Panel does not need to resolve the meaning of the expression "like products" 
in Article 2.1 TBT Agreement. As the EC has alread y said in its first written submission, this is an 
issue of considerable legal complexity, which coul d not be resolved simply through transposition of 
                                                     
 
33 EC FWS, paras. 450-451. WT/DS174/R/Add.2 
Page B-146  
 
 jurisprudence on Article III:4 GATT, but rather would also have to take the structural differences 
between the TBT Agreement and the GATT into account.
34 
 
Question 54 
 
Article 12(2) of Regulation (EC) No. 2081/92 is desi gned to avoid "practical risks of confusion".  
How would the application of the country of origin label on the basis of a product's date of registration help avoid those risks of confusion? 
 126. Typically, the geographical indication which is registered first will have been marketed under 
that name longer, and will therefore already be known by consumers. Inversely, the geographical 
indication which is registered later will have been used less long, and will be less known by 
consumers. It is therefore in line with consumer expectations to require appropriate labelling for the 
indication registered later. This solution also take s into account the fact that the older geographical 
indication is already registered, and that the term s of its protection can therefore no longer easily be 
amended.  
Question 55 
 
Does the TRIPS Agreement apply as lex specialis  as regards GATT 1994 and the TBT Agreement, 
with respect to a practical condition to differentiate homonymous or identical GIs on a label?  Please 
comment in the light of Article 23.3 of the TRIPS  Agreement, which is applicable to homonymous GIs 
for wines, and the national treatment obligation, which is applicable to GIs for other products . 
 
127. The EC would agree that Article 23.3 TRIPS must be considered as a lex specialis  with 
respect to the practical conditions to differentiate homonymous or identical GIs on a label. Under this 
provision, the practical conditions for differentiati on of homonymous indicatio ns will be determined 
by each Member, taking into account the need to  ensure equitable treatment of the producers 
concerned and that consumers are not misled. This constitutes an exhaustive set of disciplines for this 
issue, which exclude the application of the nati onal treatment provisions of the GATT and the TBT 
Agreement.  128. It is noteworthy that the TRIPS Agreement does not contain a corresponding provision for homonymous geographical indications for products other than wines. Therefore Members must decide 
whether and how to accord protection to homonymou s geographical indications on the basis of the 
general provisions of Section 3, and notably of Ar ticle 22.4 of the TRIPS Agreement. This indicates 
that Member enjoy a greater degree of discretion as to how to resolve conflicts between homonyms 
for products other than wines. This further confirms  the view of the EC that the national treatment 
provisions of the GATT, the TRIPS and the TBT Agreement should not be held to apply to 
Article 2(2) of Regulation 2081/92. 
 
Question 57 
 
Does the EC consider that it may apply equivale nce and reciprocity conditions to WTO Members 
under Article 12a(2) or any other provision of Re gulation (EC) No. 2081/92, even if Article 12(1) 
does not apply to them?  
129. No. The EC merely requires that the c onditions of Regulation 2081/92 regarding product 
specifications and inspections are met as regards the specific product for which protection is sought. 
 
                                                     
 
34 EC FWS, para. 474.  WT/DS174/R/Add.2 
 Page B-147 
 
 
 Question 59 
 
Under what circumstances would the Commission consider the holder of a GI certification mark 
registered in another WTO Member to meet th e requirements for inspection structures under 
Article 10 of Regulation (EC) 2081/92 (read toge ther with Article 12a of that Regulation)? 
 130. The EC understands that the question of th e Panel relates to a certification mark which 
protects the use of a name which would qualify for protection as a geographical indication under Regulation 2081/92.  
131. Any inspection structure must comply with the conditions set out in Article 10 of 
Regulation 2081/92. According to Article 10 (2) of Regulation 2081/92, the inspection structures must 
offer adequate guarantees of objectiv ity and impartiality with regard to all producers or processors 
subject to their control. The answer to the ques tion would therefore depend on how the holder of the 
certification mark is related to the producers or pr ocessors in question. If the holder is not itself a 
producer or processor, and is independent of them, then it would not seem excluded that it could also 
function as an inspection structure. Otherwise, it would be necessary to establish an independent inspection structure which offers the necessar y guarantees of independence and impartiality. 
 
Question 60 
 
Australia argues that the EC's inspection structu res requirements are a technical regulation under the 
TBT Agreement (paragraphs 209-224 of  its first written submission).  Is there a dividing line lies 
under the TBT Agreement between a technical regulati on and a conformity assessment procedure?  If 
so, where does it lie?  
 
132. In the view of the EC, the dividing line follows  clearly from the definitions in points 1 and 3 
of Annex 1 to the TBT Agreement. According to point 1 of Annex 1, a technical regulation "lays 
down product characteristics". According to point 3, a conformity assessment procedure ensures that 
"relevant requirements in technical regulations [...] are fulfilled".  133. In other words, technical regulation set down product characteristics in general and abstract 
terms. Conformity assessment procedures verify th e compliance of concrete products with such 
requirements. In yet other words, the difference is the one between abstract regulation and the 
enforcement of regulations in concrete cases. 
 134. In accordance with Article 10(1) of Regulati on 2081/92, inspection structures ensure that 
agricultural products and foodstuffs bearing a protect ed name meet the requirements laid down in the 
specifications. In other words, in spection procedures ensure the compliance of concrete products with 
the abstract specifications. On the basis of the defi nitions set out above, there should therefore be no 
doubt that the requirements regarding inspectio n structures concern a conformity assessment 
procedure.  
Question 61 
 
If the inspection structures are conformity assess ment procedures, are the eligibility criteria for 
registration under Regulation (EC) No. 2081/92, agai nst which conformity is assessed, technical 
regulations?  
135. As a preliminary point, the EC would like to  remark that the only claim which Australia has 
raised with respect to the eligibility criteria for registration under Re gulation 2081/92 concerns 
Article 12(2), i.e. the provision regarding homon ymous protected names from the EC and third WT/DS174/R/Add.2 
Page B-148  
 
 countries. The Panel does therefore not need to th e address the question of whether other eligibility 
criteria contained in the Regulation mi ght constitute technical regulations. 
 136. Furthermore, the EC notes that it is wrong to  suggest that "conformity is assessed against" the 
eligibility criteria for registration. The existen ce of inspection structures constitutes a condition for 
registration. Accordingly, inspection structures do not  ensure that the criteria for the eligibility of 
registration are met; they ensure that concrete pr oducts bearing a protected name comply with the 
product specifications.  137. In reality, the eligibility criteria for registra tion have nothing to do with technical regulations. 
They do not lay down characteristics for specific pr oducts, but apply for all geographical indications 
for which protection is sought under the Regulation. Accordingly, the Regulation, and in particular its 
eligibility criteria for registration, do no lay dow n product characteristics. Rather, they require the 
definition of product specifications as part of the application process. However, "requiring the 
definition of product characteristics" (by the appli cant) is not the same thing as "laying down product 
characteristics". 
 138. Quite remarkably, Australia has character ised Regulation 2081/92 as "establishing a process 
related to product characteristics".
35 However, as the EC has already had the occasion to remark at the 
first meeting with the Panel, a measure "establishing a process related to product characteristics" is 
not the same thing as a measure actually laying down product characteristics. 
 
139. Are the very most, the question could ther efore be asked whether the individual product 
specifications for specific protected names constitute  technical regulations. However, the EC notes 
that Australia has made no claims with respect to any particular specifications, and that this issue is 
therefore outside the terms of reference of the Panel. 
 
Question 63 
 
What does Article 14(2) of Regulation (EC)  No. 2081/92 mean where it provides that a prior 
trademark "may continue to be used"?  
140. Article 14(2) of Regulation 2081/92 is an ex ception to Article 13(1) of the same regulation, 
which provides that registered geographical indicati ons shall be protected against certain practices, 
including certain uses of trademarks. Article 14(2) al lows trademark owners to continue to use their 
trademarks in relation to goods which do not comp ly with the requirements of the geographical 
indication, in circumstances where such use would be prohibited by Article 13(1). 
 
Can a trademark owner invoke the rights conferred by  the trademark registration against the user of 
a GI used in accordance with its GI registration?    
141. Article 14(2) of Regulation 2081/92 does not conf er to a trademark owner the right to prevent 
the use of the name, as such, that has been register ed as a geographical indication by the right holders 
of such indication. That would render meaningless the registration of that name as a geographical 
indication and the protection attached to such registration by Article 13(1).   142. On the other hand, and contrary to what  is erroneously assumed by the United States
36, a 
trademark owner may use its trademark rights in orde r to prevent the right holders of a geographical 
indication from using confusingly any other names or  other signs (e.g. graphic signs) in conjunction 
with, or in place of, the name registered as a ge ographical indication, which are not covered by such 
                                                      
35 Oral Statement by Australia at the First Panel hearing, para. 43. 
36 US Oral Statement paras. 54-55.  WT/DS174/R/Add.2 
 Page B-149 
 
 
 registration. In other words, the right holders of a geographical indication only have a positive right to 
use the name registered as a geographical indicati on. That right does not extend to other names or 
signs which have been not been registered. If the use of such unregistered names or signs leads to 
likelihood of confusion with the same or a similar sign which is the subject of a valid trademark it 
may be prevented by the owner of that trademark.  
 
143. Furthermore, while the right holders of a ge ographical indication have a positive right to use 
the registered name, this does not mean that they  are allowed to use it in any possible manner. As 
explained37, the name registered as a geographical indi cation must be used in accordance with the 
generally applicable provisions of Directive 2000/ 13 on the labelling, presenta tion and advertising of 
foodstuffs38 and of Directive 84/450 on misleading advertising39, as well as with the unfair 
competition laws of the Member States.40 
 
Question 64 
 
Does Article 14(2) of Regulation (EC) No. 2081/92 im plement the provision in Article 24.5 of the 
TRIPS Agreement that measures adopted to im plement the Section on GIs shall not prejudice 
"eligibility for or validity of the registration of a tr ademark, or the right to use a trademark" or does it 
only implement the provision that such measures shall not prejudice "the right to use a trademark"?   
 
144. As explained in the EC's First Written Submission (paragraph 302), Article 14(1) of 
Regulation 2081/92 maintains the eligibility of the a pplications and the validity of the registrations 
grandfathered by Article 24.5 of the TRIPS Agreem ent, while Article 14(2) preserves the right of the 
owners of grandfathered trademarks to continue to use their trademarks concurrently with a registered 
geographical indication.  Question 65 
 
Does the scope of Article 14(2) of Regulation (E C) No. 2081/92, as drafted, include trademarks 
applied for or registered, or to which rights have been acquired, subsequent to both dates set out in Article 24.5(a) and (b) of the TRIPS Agreement?    
145. This question does not appear to be relevant to  resolve the issues before the Panel, since the 
complainants have not made any claim to the effect that the temporal criteria laid down in 
                                                     
 
37 EC's First Submission, para. 319. See also the re sponses of the EC and its Member States to the 
review under Article 24.2 of the TRIPS Agreement contained in document IP/C/W/117/Add10 (Exhibit EC-29). 
38 Exhibit EC-30. See in particular Article 2.1, which provides that 
 
The labelling and methods used must not: (a) be such  as could mislead the purchaser to a material 
degree, particularly: (i) as to the characteristics of the foodstuff and, in particular, as to its … origin  or 
provenance … 
 
39 Exhibit EC-31. Article 2.2 of the Direc tive defines "misleading advertising" as 
 
"any advertising which in any way, including presentation, deceives or is likely to deceive the person to 
whom it is addressed or whom it reaches and which,  by reason of its deceptive nature, is likely yoto 
affect their economic behaviour or wh ich, for those reasons, injures or is likely to injure a competitor".  
 Article 3 provides that in determining whether advertising is misleading account shall be taken inter alia  of 
information concerning the geographic or commercial origin  of the goods and of the rights of the advertiser, 
including ownership of commercial, indust rial and intellectual property rights. 
40 References to the relevant laws of the Member Stat es are found in their resp onses to the review under 
Article 24.2 of the TRIPS Agreement. (Exhibit EC-29)  WT/DS174/R/Add.2 
Page B-150  
 
 Article 14(2) of Regulation 2081/92 would be somehow inconsistent with those of Article 24.5 of the 
TRIPS Agreement. Were the complainants to raise an y such claim at this stage of the proceedings, it 
would have to be considered outside the terms of reference of the Panel. 
 146. In any event, Article 14(2) is fully consiste nt with Article 24.5 of the TRIPS Agreement. Any 
trademark applied for, or established by use, before  1 January 1996, but after the date of application 
for a registered geographical indication, could no t be deemed to have been so "in good faith". 
 147. Furthermore, the complainants have not allege d, let alone proved, that the registration of any 
of the geographical indications that were applied fo r before 1 January 1996, which constitute a closed 
category, has resulted or will result in a likelihood of confusion with any of the trademarks that were 
applied for, registered, or established by use be fore 1 January 1996, but after the date of the 
application for the geographical indication, wh ich also constitute a closed category.   
 
Question 66 
 
Has Article 14(2) of Regulation (EC) No. 2081/92 ever been applied in a spec ific case?  For example, 
what did the national courts finally decide in th e Gorgonzola case, referred to in Exhibit US-17 and 
in footnote 140 to paragraph 163 of the US first wr itten submission, after the order of the European 
Court of Justice?   
148. Article 14(2) of Regulation 2081/92 does not have to be "applied" by the registering 
authorities. Rather, it sets out the legal consequen ces that follow from a decision providing for the 
registration of a proposed geographical indication.  149. The "Cambozola"
41 case mentioned in the question rema ins so far the only instance where 
Article 14(2) has been interpreted by the European Court of Justice. In essence, the issues in dispute 
in that case were whether the use of the trademark "C ambozola" fell within one of the situations listed 
under Article 13(1) and, if so, whether the conditio ns laid down in Article 14(2) for allowing the 
continued use of that trademark were met.  150. The European Court of Justice concluded that  the use of the trademark "Cambozola" might be 
deemed to evoke the registered geographical indica tion "Gorgonzola" and, therefore, fall within the 
scope of Article 13(1)(b), even if the true origin was indicated in the packag e. As regards the question 
of whether the trademark "Cambozola" could continue  to be used in accordance with Article 14(2) the 
Court ruled that   
… It is for the national court to decide wh ether, on the facts, the conditions laid down 
in Article 14(2) of Regulation No 2081/ 92 allow use of an earlier trademark to 
continue notwithstanding the registration of the protected designation of origin 'Gorgonzola', having regard in pa rticular to the law in force at the time of registration 
of the trade mark, in order to determine whether such registration could have been 
made in good faith, on the basis that use of a name such as 'Cambozola' does not, per 
se, constitute an attempt to deceive the consumer. 
151. Following the Judgement of the European Court of Justice, the Supreme Court of Austria 
ruled that the trademark "Cambozola" had been regi stered in good faith and was not affected by any 
                                                     
 
41 Judgement of the European Court of Justice  of 4 March 1999, Case C- 87/97,  Consorzio per la 
tutela del Fromaggio Gorgonzola v. Kaeserai Champignon Hofmeister GmbH & Co. KG, Eduard Bracharz 
GMbH.  (Exhibit EC-32).  WT/DS174/R/Add.2 
 Page B-151 
 
 
 ground of invalidity a nd, therefore, in accordance with Artic le 14(2), could continue to be used 
concurrently with the registered geographical indication "Gorgonzola".42 
 152. The EC Commission is not aware of any other d ecisions of the courts of the Member States 
where Article 14(2) has been interpreted. 
 
Question 67 
 
Does Article 14(3) of Regulation (EC) No. 2081/92 af fect the possibility of coexistence of GIs already 
on the register with prior trademarks,  such as Gorgonzola?  In these cases, is Article 14(3) relevant 
to the applicability of Article 14(2)?  
 
153. Article 14(3) remains relevant even afte r a geographical indication has been formally 
registered. The owner of a concurrent trademark (e .g. "Cambozola") could cha llenge before the courts 
the decision to register the geographical indication by  claiming that the decision is inconsistent with 
Article 14(3).  
 
Question 68 
 
Article 14(3) of Regulation (EC) No. 2081/92 mentio ns certain criteria.  If these are not exhaustive, 
why does is it not expressly stated as in Articles 3(1), 4(2) and 6(6) of the Regulation? 
 154. At the outset, it is useful to recall the wo rding of Article 14(3) of Regulation 2081/92: 
 
A designation of origin or geographical indication shall not be registered where, in the light of trade mark's reputation and renown and the length of time it has been 
used, registration is liable to mislead the consum er as to the true origin of the product.   
155. Thus, contrary to what has been claimed by the complainants, Article 14(3) does not say that 
the registering authority shall refuse the registration of a geographical indication only if it gives rise to 
a likelihood of confusion with a trademark which is  famous and has been used for a long period of 
time. Rather, Article 14(3) says that the registration of a geographical indication shall be refused if it 
is likely to lead to confusion with a trademark, "i n light of" the trademark's reputation and renown and 
the length of time that it has been used. 
 156. In other words, the length of use and reput ation/renown of the trademark are not separate 
"requirements"
43, additional to the likelihood of confusion, for the application of Article 14(3). Rather, 
they are criteria for establishing the existence of a likelihood of confusion. From the fact that the 
Commission must consider those two criteria when assessing the likelihood of confusion, it does not 
follow a contrario  that it cannot consider also other criteria.  Indeed, as explained below, in practice it 
would be impossible to evaluate the likelihood of confusion on the basis of only those two criteria. 
 157. As explained
44, Article 14(3) directs expressly the registering authority to consider the length 
of use and the reputation and renow n of earlier trademarks because those criteria will generally be 
decisive in order to establish the likelihood of conf usion, given that geographical names are primarily 
non-distinctive, and not because only the likelihood of  confusion with famous marks that have been 
used for a long time is deemed relevant.  
                                                     
 
42 Austrian Supreme Court (Oberster Gerichtshof), Case 40625/01 G, Judgement of 7 October 2001. 
43 US Oral Statement, para. 53. 
44 EC's FWS, paras. 278-291. WT/DS174/R/Add.2 
Page B-152  
 
 158. If Article 14(3) does not mention expressly the similarity of goods and signs, it is simply 
because those criteria are always relevant to estab lish the likelihood of conf usion between two signs 
and must necessarily be taken into account. Indeed, as discussed below, neither the length of use nor 
the reputation and renown of a trademark can be assessed meaningfully without taking into account 
the degree of similarity of the goods and signs. More over, it must be recalled that the application of 
Article 14(3) presupposes the applicability of Article 13( 1) and that, in order to determine whether the 
use of a trademark falls within one of the situ ations listed under Article 13(1), it is necessary to 
consider the similarity of goods and signs.   159. Furthermore, the interpretation of Article 14( 3) made by the complainants would lead to a 
result which conflicts and cannot be  reconciled with the obligations imposed upon the EC institutions 
by Articles 7(4) and 7(5)(b).   160. Article 7(4) provides that a statement of objection shall be admissible, inter alia , if it shows 
that "the registration of the name proposed  would jeopardize the existence of a mark".
45 This language 
encompasses any instance of likelihood of confus ion between the proposed geographical indication 
and an earlier trademark. If Article 14(3) only required the refusal of a proposed geographical 
indication where it gives rise to likelihood of confus ion with a famous trademark used for a long time, 
as claimed by the complainants, th e admissible grounds of objection would have been limited to the 
cases where one such mark is likely to be jeopardized . Article 7(4), however, refers to all trademarks, 
without any distinction or qualification. It would be pointless to admit an objection on certain grounds 
if, in any event, it were not possible to reject the application on such grounds. 
 161. Further confirmation is provided by Article 7( 5)(b), which provides that where an objection is 
admissible, and no agreement is reached among the Member States concerned,   
the Commission shall take a decision in accord ance with the procedure laid down in 
Article 15, having regard to traditional fa ir practice and likelihood of confusion.
46 
162. Thus, Article 7(5)(b) requires the Commissi on to adopt a decision having regard to the 
"likelihood of confusion" between th e proposed geographical indication and any other marks. There is 
no basis in Article 7(5)(b)  for the proposition that  only the likelihood of confusion with  famous 
marks used for a long time must be taken into account by the Commission.  
 
Do other criteria, such as similarity of signs  and goods fall within "reputation and renown"? 
 
163. As suggested by the question, the criteria  mentioned expressly in Article 14(3) cannot be 
applied without taking into account at the same ti me the degree of similarity between the goods and 
signs concerned, which must, therefore,  be deemed implicit in Article 14(3). 
 164. The mere fact that a trademark enjoys reputation and renown and that it has been used for a long time is not sufficient to establish that a geog raphical indication will be confused with that 
trademark, if the two signs are not similar. For example, it is beyond dispute that "Coca-Cola" is a 
trademark that enjoys a formidable reputation and renown and has been used for a long time. Yet, it 
would be absurd to pretend that, as a result, th e EC public is likely to confuse the geographical 
                                                     
 
45 Articles 12b(3) and 12d(2) provide, respectively, that the criteria of Article 7(4) shall apply also with 
respect to the admissibility of objections to the registration of foreign geographical indications and of objections 
from outside the EC to EC geographical indications. 
46 Similar language is found in Articles 12b(3) and12d(3) with regard to the registration of 
geographical indications from other WTO Members and third countries and to the registration of EC 
geographical indications, following an objection from outside the EC, respectively.  WT/DS174/R/Add.2 
 Page B-153 
 
 
 indication "Jijona" with the trademark "Coca-Cola",  given the lack of similarity between the two 
signs.     165. Similar considerations can be made with r espect to the similarity of goods. For example, a 
geographical indication for cheese may be less likely to  be confused with a trademark that enjoys 
great reputation and renown with respect to shoes th an with a trademark for cheese even if it has less 
renown and reputation. Similarly, the length of time during which a trademark has been used must be 
determined in relation to a given category of goods. To continue with the same example, a 
geographical indication for cheese may be less likely to be confused with a trademark for shoes that 
has been used for decades than with a relatively r ecent trademark for cheese. 
 
166. The above examples illustrate that the like lihood of confusion between two signs cannot be 
properly established by considering only the length of  use and the reputation/renown of one of them, 
but must take into account necessarily the similarity of the goods and signs concerned. An interpretation of Article 14(3) which prevented the registering authority from considering the 
similarity of goods and signs would be neither re asonable, nor workable, and cannot be correct. It 
must be concluded, therefore, that the criteria mentioned in Article 14(3) do not purport to be 
exhaustive.  
Is the criterion of "length of time [a trade mark] has been used" relevant to its liability to mislead if 
the trademark has not been used for a si gnificant, or considerable, length of time?  
 
167. Article 14(3) requires the registering authorit y to consider the length of time during which a 
trademark has been used. The reason why this crite rion must be considered is because, as a general 
rule, the longer a trademark has been used, the more  distinctive it will be, and, as result, the more 
likely that a proposed geographical indication may be confused with it. 
 
168. However, contrary to what has been argued by the complainants, Article 14(3) does not say 
that the registering authority must refuse the registration of a geographical indication only if it has been shown that the trademark has been used for a long time. It is conceivable that a trademark which 
has been used for a relatively short period of time may, nevertheless, have become strongly distinctive 
through other means (e.g. publicity), so as to make  it likely that the proposed geographical will be 
confused with it.  
 
Question 69 
 
Can the EC provide the Panel with any official st atement predating its first written submission that 
application of the grounds for registration, invalidity  or revocation of tradema rks and Article 14(3) of 
Regulation (EC) No. 2081/92 will or should be applied in such a way as to render Article 14(2) 
inapplicable?    
169. The EC institutions have not issued any genera l interpretative "statement" of Article 14(3) of 
Regulation 2081/92. The same is true of all the ot her provisions of Regulation 2081/92. Indeed, unlike 
in other jurisdictions, it is relatively unusual fo r the EC authorities to issue any such general 
interpretative statements with resp ect to the EC legislative acts. 
 170. As mentioned in the EC's First Written Submission
47, Article 14(3) of Regulation 2081/92 has 
been applied only once by the EC institutions. The in terpretation made in that case is consistent with 
the interpretation advanced by the EC in this di spute.  The Council concluded that there was no 
likelihood of confusion with earlier trademarks "in view of the facts and information available". There 
is no suggestion in the Council decision that it was considered that there was no likelihood of 
                                                      
47 EC's FWS, para. 288.  WT/DS174/R/Add.2 
Page B-154  
 
 confusion because the trademarks concerned were not famous enough or had not been used for a 
sufficiently long time.    171. The EC wishes to clarify that it is not the EC's  position that its trademar k legislation, together 
with Article 14(3) of Regulation 2081/92, "render Article 14(2) inapplicable". Rather, the EC's 
position is that its trademark legislation, together  with Article 14(3), prevent the registration of 
geographical indications that result in a likelihood of confusion with pre-existing trademarks, which is 
the  only type of confusion envisaged in Article 16.1 of the TRIPS Agreement. Article 14(2) applies 
to other situations not involving that type of c onfusion where, in accordance with Article 13(1) of 
Regulation 2081/92, the right holders of a register ed geographical indication would be entitled, in 
principle, to prevent the use of an earlier  trademark.   
 
Question 70 
 
Do the EC member States agree with the Commission' s submission to this Panel that the terms of 
Article 14(3) of Regulation (EC) No. 2081/92, if pr operly interpreted, are sufficient to prevent the 
registration of any confusing GIs?  
172. The EC recalls that the submissions to th e Panel are made on behalf of the European 
Communities, and not of the EC Commission.  
173. The EC also recalls that Regulation 2081/ 92 is a measure of the European Community and 
not of its Member States. Therefore, in principle,  only the views of the EC institutions, and not the 
individual views of the EC Members States, are rele vant for the interpretation of Regulation 2081/92.  
 174. In any event, the Member States of the EC are aware of the legal interpretations stated in the 
EC submission. They have expressed no objections or reservations. 
 
Could the EC member States apply national trademark laws in a way that made this impossible? 
 
175. This question is unclear to the EC. The EC fa ils to see how the Member States could, through 
the application of their national trademark laws, pr event a correct application of Article 14(3) of 
Regulation 2081/92.  
 176. In any event, the EC Member States are requi red under EC law to apply their trademark laws 
consistently with all the releva nt provisions of EC law, including in particular the Trademark 
Directive. For the reasons explained by the EC in  its First Written Submission, the registrability 
criteria provided in the Trademark Directive limit a priori  the risk of conflicts between trademarks 
and geographical indications. The complainants have not been able to identif y one single case where a 
registered geographical indication has resulted in a likelihood of confusion with a trademark 
registered by the authorities of the Member States un der their national trademark laws. This confirms 
that, in practice, Member States apply those laws c onsistently with the interpretation advanced by the 
EC in this dispute.       
 
Could the Council of Ministers prevent the application of Article 14(3) of the Regulation if proposed 
by the Commission in a specific case and apply Article 14(2)?  
177. In principle, the Commission is not required to submit proposals to the Council. Rather, the Commission must request the opinion of the Committee in accordance with Article 15 of 
Regulation 2081/92 before adopting a decision gran ting or refusing a registration. If the Committee 
gives a negative opinion, the Commission must subm it a proposal to the Council, which may, acting 
by qualified majority, adopt it or indicate its oppos ition within a certain period of time. The Council  WT/DS174/R/Add.2 
 Page B-155 
 
 
 could oppose a proposal from the Commission to refuse a registration on the basis of Article 14(3) if 
it considers that the conditions provided in that Article are not met.    
Question 71 
 
Has a judicial authority ever ruled on the interp retation of Article 14(3)  of Regulation (EC) 
No. 2081/92?  
178. As noted in the EC's First Written Submissi on (para. 288) Article 14(3) of Regulation (EC) 
No. 2081/92 has never been interpreted by the Europ ean Court of Justice or by the courts of the 
Member States. Once again, this confirms that , as explained by the EC, the criteria for the 
registrability of trademarks ensure that the potential for conflicts between trademarks and 
geographical indications is very limited.  179. As explained above
48, according to well-established case law of the European Court of 
Justice, EC law must be interpreted, to the extent  possible, in a manner that ensures its consistency 
with the WTO Agreement, in particular where it is  intended specifically to give effect to that 
agreement. This principle of interpretation must be  observed also by the other EC institutions and by 
the courts of the Member States when interpreting EC law.  180. Moreover, as also explained
49, the European Court of Justi ce takes account of the assurances 
regarding the interpretation of EC law given by  the EC Commission on behalf of the European 
Communities in international fora, such as the WTO.     
If Article 14(3) of the Regulation, the Commun ity trademark regulation and national trademark laws 
were applied in such a way as to prevent the registr ation of GIs that were confusing with a prior 
trademark, could this be subject to judicial review? 
 
181. A decision refusing the registration of a proposed geographical indication on the grounds 
provided in Article 14(3) of Regulation 2081/92 can  be challenged before the courts, just like any 
other decision refusing or granting the registra tion of a proposed geographical indication.  
 
182. Likewise, the decisions of the trademark author ities of the Member States or of the Office for 
Harmonisation in the Internal Market to refuse the registration of a trademark on the grounds provided 
in letters (b), (c) or (g) of Article 3.1 of the Trad emarks Directive, or in letters (b), (c) or (g) of 
Article 7.1 of the Community Trademark Regulation, r espectively, are also subject to judicial review. 
 Question 73 
 
Please supply a copy of the wine regulations referred to  in paragraph 16 of the EC oral statement.    
 
183. The wine regulations referred to  in paragraph 16 of the EC's Fi rst Oral Statement are the same 
mentioned in paragraphs  310-311 of the EC's First Written S ubmission. A copy of the relevant 
provisions of those regulations has been supplied as  Exhibit EC-11, together with the EC's First 
Written Submission.  
                                                     
 
48 Response to Question 15. 
49 Ibid. WT/DS174/R/Add.2 
Page B-156  
 
 Question 74 
 
Which particular GIs did the EC protect under Regulation (EC) No. 2081/92 prior to 
1 January 1995?   
184. The registration of a geographical indicati on under Regulation 2081/92 produces effects vis-
à-vis concurrent trademarks from the date of appli cation (cf. Article 14(1) of Regulation 2081/92). Of 
the 658 geographical indications currently register ed, 487 were applied for prior to 1 January 1995. 
 185. Furthermore, many of the geographical i ndications registered or applied for under 
Regulation 2081/92 were already protected at th e Member State level prior to 1 January 1995. 
 
Is Article 24.3 of the TRIPS Agreement relevant to any other GIs?   
 
186. Yes. Article 24.3 requires to maintain the level of protection of geographical indications 
available on 1 January 1995, rather than the protecti on of the particular geographical indications that 
were registered, or applied for on that date.  187. On the interpretation suggested in the question, Article 24.3 would impose obligations only upon those Members which  protect geographical indica tions via a system of registration, or another 
system involving the recognition ex ante  of geographical indications, but not where protection is 
provided through other systems (e.g. unfair compe tition laws or generally applicable consumer 
protection regulations that apply indistin ctly to any geographical indications). 
 188. For example, assume that, before 1 January  1995, a Member had legislation in place 
prohibiting the use of any geographical indications for products of a different origin, even when the 
geographical indication is used together with terms such as "type", "kind", etc. On the interpretation 
suggested in the question, after 1 January 1995, that  Member would be free to repeal such legislation 
with respect to products other than wine and spir its, even though this would clearly "diminish the 
protection of geographical indications".  189. Moreover, the above result would be at odds w ith the principle established in Article 1.1 of 
the TRIPS Agreement, according to which Members are free to determine th e appropriate method of 
implementation of their WTO obligations. Members ca nnot be said to be "free" to choose the method 
of implementation of Section 3 of Part II, if choosing a certain method has the consequence of 
subjecting them to stricter obligations under Article 24.3.  
190. The United States has argued that the meaning of  Article 24.3 is that "the protection provided 
to those GIs should not diminish the protections (sic) for the GIs that existed when the TRIPS 
Agreement came into force."
50 
 191. This proposition is difficult to understand. Pr oviding protection to geographical indications 
cannot, as a matter of simple logic, "diminish" su ch protection. Rather the existing protection of 
geographical indications may be "diminished" as a re sult of the implementation of the limitations to 
the protection of geographical indications provided in Section 3 of Part II, including in particular 
those stipulated in Article 24.5 in order to mainta in certain rights of the owners of grandfathered 
trademarks.   
192. Moreover, the US interpretation has no textua l basis in the wording of Article 24.3, which 
reads as follows:  
                                                     
 
50 US Oral Statement, para. 70.  WT/DS174/R/Add.2 
 Page B-157 
 
 
 In implementing this section, a Member shall not diminish the protection of 
geographical indications that existed in that  Member immediately prior to the date of 
entry into force of the WTO Agreement. 
193. First, Article 24.3 alludes to the "protecti on of geographical indications", and not to the 
"protections" in the plural form, as argued by the United States. Moreover, the term "geographical 
indications" is not preceded by the word "the". This  indicates that the drafters had in mind the general 
level of protection available in each Member. Se cond, the term "existed" refers to the word 
"protection" and not to the "geographical indicati ons". It is not required, therefore, that the 
geographical indications "existed", or a fortiori  that they had been specifically recognised as such, as 
of the date of entry into force of the WTO Agreem ent.  This is made clear by the Spanish and the 
French versions, which read as follows, respectively: 
 
Al aplicar esta Sección, ningún Miembro reducirá la protección de las indicaciones geográficas que existía  en él inmediatamente antes de la fecha de entrada en vigor del 
Acuerdo sobre la OMC. [emphasis added]   
Lorsqu'il mettra en oeuvre la présente sec tion, un Membre ne diminuera pas la 
protection des indications géographiques qui existait  dans ce Membre 
immédiatement avant la date d'entrée en vigueur de l'Accord sur l'OMC. [emphasis added] 
194. The United States also argues that Article 24.3 is an "exception" with respect to the 
"implementation of the GI Section of the TR IPS Agreement" and not an "exception to the 
implementation of the trademark obligations".
51 This argument is specious. In the first place, 
Article 24.3 is not an "exception" to the protec tion of geographical indications, because it does not 
exempt Members from the obligations provided unde r Section 3 of Part II. Rather, it adds a 
supplementary obligation. Second, the "protection" of geographical indications includes "protection" 
vis-à-vis the exercise of trademark rights.  Indeed, Section 3 of Part II provides expressly for such 
type of protection in Articles 22.3, 23.2 and 24.5.  Those provisions operate as limitations to the 
"trademark obligations" under Article 16.1. Artic le 24.3 provides for another limitation to those 
"trademarks obligations".  195. The objective of Article 24.3 is to main tain the balance between the protection of 
geographical indications and that of trademarks that existed in each Me mber at the entry into force of 
the WTO Agreement. If, prior to that date, a Member provided protection vis-à-vis trademarks going 
beyond that required by Section 3 of Part II, it is required to continue do so after that date. For 
example, if prior to 1 January 1995 a Member pr ovided generally the type of protection required by 
Article 23.2 for wines and spirits with respect to all products, it must continue to do so after that date, 
whether or not a certain geographical indication had been specifically recognised  as such before that 
date. 
 196. Finally, the United States argues that the EC  interpretation would allow Members to derogate 
from " any WTO provision".
52 This is simply not true. Article 24.3 requires Members to depart from 
other WTO provisions only to the extent necessar y to maintain the existing "protection" of 
geographical indications. In order to "protect" geographical indications it is not necessary, for 
example, to limit patent rights or copyrights.53 On the other hand, as mentioned, it is beyond question 
that "protecting" geographical indications may require to limit trademark rights.   
                                                     
 
51 Ibid. 
52 Ibid., para. 72. 
53 Ibid. WT/DS174/R/Add.2 
Page B-158  
 
 Question 75 
 
Which party bears the burden of proof in relation to: 
  (a) Article 24.5 of the TRIPS Agreement?  In  particular, does this relate to the scope of 
the obligation in Article 16.1?  Does it  create an exception for measures otherwise 
covered by Article 16.1?  Or neither?  
 
197. Article 24.5 is not an "exception" to Article  16.1. Rather, it defines the boundary between a 
Member's right to implement protection for geogra phical indications and its obligation to protect 
trademarks under Article 16.1.
54 The burden of proving that a measure falls within the scope of the 
obligations provided in Article 16.1 is on the complainants. 
 198. The EC notes that, while the United States now argues that Article 24.5 is an "exception"
55, in 
its panel request it has stated a claim under that provi sion. Similarly, Australia cited Article 24.5 in its 
panel request and has made a claim under that provision in its First Written Submission.56   
 
 (b) Article 17 of the TRIPS Agreement?  In particular, does this only permit exceptions to 
the rights conferred by a trademark, or does it also create an exception to the obligations imposed on Members? 
 
199. Article 17 allows Members to provide limited exceptions to the rights which they are obliged 
to confer upon the owner of trademark by virtue of Ar ticle 16. To that extent, it is an exception to the 
obligations imposed upon Members by Article 16. The function of Article 17 is  similar to that of 
Articles 13 and 30. Previous panels  have taken the view that the burden of invoking those provisions 
and of proving that the relevant conditions for their applicability were met was on the defendant.
57  
 
Question 76 
 
Article 24.5 of the TRIPS Agreement uses the phrases  "validity of the registration of a trademark" and 
"the right to use a trademark".  Please set out y our interpretation of these phrases, in accordance 
with the general rule of treaty interpretation in Article 31 of the Vienna Convention on the Law of 
Treaties and, if appropriate, the supplementary means  in Article 32.  Please explain how you 
determine what is the relevant context.    
The ordinary meaning
 
 
200. A "trademark" is not a right. It is a sign which may be the subject of a right.  Thus, 
Article 15.1 of the TRIPS Agreement provides in relevant part that  
Any sign, or any combination of signs, capable of distinguishing the goods or services of one undertaking from those of ot her undertakings, shall be capable of 
constituting a trademark. 
201. Therefore, the "right to use a trademark" is th e right to use a sign. That right is different from, 
and does not include the right to prevent others fro m using the same or a similar sign. According to 
                                                     
 
54 Australia's FWS,  para. 105. 
55 US Oral Statement, para. 58. 
56 Australia's FWS, paras. 81-87. 
57 See Panel Report, United States – Section 110(5) of the Copyright Act , paras. 6.9-6.16;  and  Panel 
Report, Canada – Patent Protection of Pharmaceutical Products , para. 7.16.   WT/DS174/R/Add.2 
 Page B-159 
 
 
 WIPO58, typically the owner of a registered trademark has an "exclusive right to use the trademark", 
which "encompasses two things":  
 •  the "right to use the trademark" and 
 
 •  the "right to exclude others from using the mark". 
 202. In turn, according to WIPO the "right to use a trademark" means the following:
59 
 
It means first the right of the owner of the mark to affix it on goods, contains, packaging, labels, etc. or to use it in a ny other way in relation to the goods for which 
it is registered. 
It means also the right to introduce the goods to the market under the trademark. 
203. The term "validity" alludes to something wh ich is "valid", which in turn means something 
"having legal strength or force, executed with proper formalities, incapable of being rightfully 
overthrown or set aside."
60 The opposite of "valid" is "invalid ", which means "having no force, 
efficacy, or cogency, esp. in law".61 
 204. In order to be "valid", the registration of  a trademark does not necessarily have to confer 
exclusive rights vis-à-vis all third parties. The fact  that the owner of a registered trademark cannot 
prevent the use of the same or a similar sign by th e right holders of a geographical indication does not 
mean that the registration of the trademark is, for that reason alone, "set aside", or "overthrown" or 
that it is without "legal strength" or "efficacy".  
205. The US interpretation of Artic le 24.5 fails to give meaning to the phrase "the right to use the 
trademark". If the exclusive right to use a trademark were already inherent in the term "validity of the 
registration", it would have been superfluous to pr ovide in Article 24.5 that the implementation of 
Section 3 of Part II shall not prejudice "the right to use the trademark".  
206. The United States asserts that the phrase "the right to use a trademark" clarifies  and adds  to 
the protection of grandfathered trademarks alre ady provided by the other terms of Article 24.5.
62 
However, as a matter of simple of logic, that phrase cannot do both things simultaneously. Either it 
adds  an obligation, or it clarifies  those obligations already provided by the other terms of Article 24.5.  
 207. If the phrase "the right to use a trademark" adds  new obligations, it would mean that, as 
argued by the EC, the "validity" of a registration does not confer per se  the exclusive right to use a 
trademark. Moreover, the United States does not explain how it can reconcile its position that 
Article 24.5 is an "exception" with the view th at Article 24.5 confers to the trademark owners 
additional  rights which they do not have under Article 16.  
 
208. On the other hand, if the purpose of the phrase "the right to use a trademark" is to clarify  the 
obligations provided by the other terms of Artic le 24.5, then why did the drafters not use clear  
wording to that effect, such as, fo r example, that the implementation of  Section 3 of Part II is without 
prejudice to "the exclusive  right to use the trademark" or to "the  rights conferred by Article 16.1"?    
                                                     
 
58 WIPO,  Introduction to Trademark Law & Practice, The Basic Concepts, a WTO Training Manual , 
Geneva 1993, p.51 
59 Ibid. 
60 Black's Law Dictionary, West Publis hing Co., St. Paul,  Minn., 1990. 
61 The New Shorter Oxford English Dictionary, Ed. Lesley Brown, Clarendon Press, Oxford 1993. 
62 US Oral Statement, para. 64. WT/DS174/R/Add.2 
Page B-160  
 
  
209. The United States also argues that the EC's in terpretation would allow to "deny all the rights 
connected with registration" and would render it "meaningless".
63 This is simply not true. It must be 
emphasised, once again, that, on the EC's interpre tation, the trademark owner retains the right to 
prevent all others parties from using the trademark. 
 
210. For its part, Australia has suggested64 that the phrase "the right to use a trademark" alludes 
exclusively to the trademark rights acquired thr ough use, to which reference is made in the 
introductory phrase of Article 24.5. However, if so, it would have been more logical to say that the 
measures taken to implement Sections 3 "shall no t prejudice … the trademark rights acquired through 
use", rather than that they "shall not prejudice … th e right to use a trademark". Australia confuses the 
mode of acquisition of the trademark rights (use or re gistration) with one of the basic rights of the 
trademark owner (irrespective of whether the trad emark rights have been acquired through use or 
registration), i.e. the right to use the trademark.  
211. Moreover, trademark rights acquired through use are also, as a general rule, exclusive within 
the boundaries of the area in which they have be en used. Article 16.1 of the TRIPS Agreement 
recognises expressly the right of Members to make available exclusive trademark rights on the basis 
of use. In view of that, there is no good reason wh y Article 24.5 should provide for the co-existence of 
geographical indications and non-registered trademar ks, but prohibit the co-existence of geographical 
indications and registered trademarks, which w ould be the anomalous but necessary consequence of 
the complainants' interpretation.  
 The context
 
 212. Article 24.5 is included in Section 3 of Part II, the purpose of which is to provide a minimum 
of protection to geographical indications. Such pr otection is subject to limitations in order to 
accommodate other intellectual property rights. However, it would be a paradoxical result if 
Article 24.5 were interpreted in such a way that , far from providing any protection to the legitimate 
right holders of a geographical indication, it prohibited them from even using that indication.  213. As already explained by the EC, co-exist ence is by no means an unusual solution. It is 
envisaged by several other provisions of Section 3, of Part II, and not just by Article 23.3, contrary to 
what is argued by the United States. Furthermore, co-existence is envisaged ev en where it may lead to 
some confusion. For example:  
 •  Article 23.2 allows co-existence of a geogra phical indication for wines or spirits and 
a trademark consisting or including such geographical indication if used for wines 
and spirits originating in the area to which the geographical indication relates. A 
priori , the risk that consumers may confuse that geographical indication with the 
trademark may be the same as when the products covered by the trademark do not 
originate in that area. Nevertheless, co -existence is allowed because it does not 
mislead consumers as to the true geogr aphical origin of the products;   
 
 •  Co-existence may arise as well from Article 24.3, when the protection of 
geographical indications existing before th e date of entry into force of the WTO 
Agreement provided for such co-existence (see the response to Question 74 above); 
 
 •  Finally, co-existence is envisaged also by Article 24.4, which provides that a Member 
may allow "continued and similar" use of  a geographical indication for wines or 
                                                     
 
63 Ibid. 
64 Australia's FWS, para. 74.  WT/DS174/R/Add.2 
 Page B-161 
 
 
 spirits of another Member by its nationals or domiciliaries who have used it before 1 
April 1994 in good faith or for at least 10 years preceding that date, regardless of 
whether this gives rise to confusion with the products of the other Member that are entitled to use that geographical indication.  
 
Object and purpose
 
 214. In its First Written Submission, the United States stressed that Article 16.1 had to be 
interpreted "in the light of the object and purpose of the TRIPS Agreement, and specifically with 
respect to Article 16.1 and its grant of exclusive rights".
65 
 
215. It must be recalled, however, that, under Article 31 of the Vienna Convention , only the object 
and purpose of the treaty as a whole is relevant. To the extent that granting exclusivity to trademark 
owners is one of the objects and purposes of the TRI PS Agreement, so is affording exclusivity to the 
right holders of geographical indications. As expl ained, exclusivity is as essential to geographical 
indications as to trademarks. Indeed, it could be argue d that exclusivity is even more important in the 
case of geographical indications because the choice of geographical indications, unlike the choice of 
trademarks, is not arbitrary, and because it tak es longer to establish a geographical indication.66 
 Drafting history
 
 
216. The United States has argued that the predecesso r to the current Article 24.5 included in the 
so-called Brussels Draft made no referen ce to the right to use  the trademark.67 However, such 
reference was included in the predecessor to the current Article 24.4, which provided as follows:68 
 
Where a geographical indication of a PART Y has been used with regard to goods 
originating outside the territory of the PA RTY in good faith and in a widespread and 
continuous manner by nationals or  domiciliaries of another PARTY, including as a 
trademark , before the date of application of these provisions in the other PARTY as 
defined in Article [65] below, nothing in th is Agreement shall prevent such continued 
use of the geographical indication by those nationals or domiciliaries of the said other 
PARTY. [emphasis added] 
217. The scope of the above draft provision overla pped, as far as trademarks are concerned, with 
the predecessor to Article 24.5, which read as follows:69 
 
A PARTY shall not take action to refuse or invalidate registration of a trademark first applied for or registered: 
(a) before the date of application of those provisions in that PARTY as defined 
in Article [65] below; 
(b) before the geographical indication is  protected in its country of origin; 
on the basis that the trademark is identical with, or similar to, a geographical 
indication.  
                                                     
 
65 US FWS, para. 145. 
66 EC's FWS, paras. 295 and 307. 
67 US Oral Statement, para. 64. 
68 Reproduced in Daniel Gervais, "The TRIPS Agreement, Drafting History and Analysis", Sweet and 
Maxwell, 1998, p. 133.  
69 Ibid. WT/DS174/R/Add.2 
Page B-162  
 
  
218. The reference in the predecessor to Article 24.4 to the continued use of the geographical 
indications as trademarks indicates that the authors of the Brussels Draft envisaged the co-existence of 
trademarks and geographical indications of other Members. Such co-existence, however, would be 
rendered impossible by the US reading of the predecessor to Article 24.5, which would confer to the 
owners of the trademarks covered by the predecessor  to Article 24.4 an exclusive right to use the 
geographical indication.  219. In the final text of the agreement, the refe rence to the "use of trademarks" was deleted from 
the predecessor to Article 24.4 and added to Article  24.5, but it has the same meaning and purpose as 
when it was included in Article 24.4.
70 
 
Question 77 
 
Article 24.5 of the TRIPS Agreement uses the phrase "r ight to use" a trademark.  Why did the drafters 
not choose to state, for example, "exclusive rights"  or "rights under Article 16.1"?  Is that fact 
relevant to interpretation of the phra se "right to use" a trademark?   
 
220. As suggested in the question, if the drafters  had intended to preserve the right of the owners 
of the grandfathered trademarks to prevent the u se of the geographical indication, they would have 
used express language to that effect.  
 
221. Furthermore, if Article 24.5 did not allo w co-existence, the protection of geographical 
indications provided under Part II, Section 3, would become pointless whenever there is a grandfathered trademark. Indeed, why protect the intellectual property rights of the holders of geographical indications against illegitimate uses by third parties if the right holders cannot use it 
themselves? Yet, Article 24.5 assumes that Members will continue to protect geographical indications 
("…measures adopted to implement this Sectio n shall not prejudice…"), notwithstanding the 
existence of "grandfathered" trademarks. If the draf ters' intention had been to prohibit the use of 
geographical indications concurrently with gra ndfathered trademarks, th ey would have excluded 
completely the applicability of Part II, Section 3, with respect to the geographical indications 
concerned, rather than providing that the implementa tion of that Section shall not prejudice "the right 
to use the trademark". 
 
Question 86 
 
Article 4 the Paris Convention (1967) creates no right of  priority for indications of source.  Does this 
indicate that they are irrelevant for th e purposes of the right of priority? 
 
222. The fact that the Paris Convention does not pr ovide for a right of priority in respect of 
indications of source (including appellations of origin) suggests that the parties to the Paris Convention were of the view that conflicts between indica tions of source and other industrial property 
rights should not be resolved according to the first-in-time principle. 
 
                                                     
 
70 Several reasons may explain why the reference to the use of trademarks was deleted from 
Article 24.4 and added to Article 24.5. First, unlike its pr edecessor in the Brussels Draft, Article 24.4 applies to 
wines and spirits only. Second, the temporal criteria for the application of Article 24.4 were changed and differ 
from those of Article 24.5. Third, unlike its predecessor in  the Brussels Draft, Article  24.4 applies only to the 
use of geographical indications by nationals and domiciliaries of the Member concerned. Finally, from a systematic point of view, it is more logic to group in the same Article all the provisions concerning the 
relationship between geographical indications and earlier trademarks.  WT/DS174/R/Add.2 
 Page B-163 
 
 
 Question 87 
 
What is the significance of the EC's statement that the complainants' claims a re "theoretical"?  Does 
the EC suggest that this affects the Panel's mandate or function in any way?    
223. The fact that the claims raised by the complainants are purely theoretical cast doubts on 
whether the complainants have a genuine interest in bringing this dispute. The EC, nevertheless, is not 
suggesting that the Panel's jurisdiction is affected  by the complainants' apparent lack of genuine 
interest. In particular the EC does not consider it necessary to request the Panel to rule on whether the 
complainants have acted consistently with Article 3.7 of the DSU. 
 
224. If the EC has insisted that the complainants' claims are often theoreti cal it is because this has 
implications for the Panel's assessment of whether such claims are well-founded. In particular, in 
some cases the fact that the complainants' claims are theoretical confirms that they are based on a 
misinterpretation of the measures in dispute. 
 
225. For example, the fact that the complainan ts have not been able to identify any single 
registered geographical indication which gives ri se to likelihood of confusion with any prior 
trademark confirms that, as argued by the EC, the criteria for registrability of trademarks, together with Article 14(3) of Regulation 2081/92, prev ent the registration of confusing geographical 
indications. 
 
226. Similarly, to mention but another example, the fact that Australia has not been able to provide any evidence that the EC authoriti es have rejected statements of objection for the reasons mentioned 
by Australia under Claim 21
71 confirms that Article 7(4) does not provide for the limitation of the 
grounds of objection  alleged by Australia. 
 
Question 89 
 
Is there a notion of estoppel in WTO dispute settle ment which applies where a Member refrains from 
raising claims in relation to a measure until after it is amended?  
227. According to Article 3.10 of the DSU, the pa rticipants in dispute settlement procedures under 
the DSU are bound by an obligation of good faith. Th e principle of estoppel is similarly based on the 
notion of good faith. Accordingly, the EC considers that the notion of estoppel is applicable in the context of WTO dispute settlement.  
228. However, the EC considers that the Panel ma y not have to rely on the notion of estoppel in 
the present case. As the EC has set out already in its first written submission, it considers that the 
Panel does not have jurisdiction to hear claims whic h are directed at measures which were no longer 
in force at the time the Panel was established.
72 Similarly, as regards the individual registrations, even 
if these were considered to be within the terms of reference of the Panel, the EC has already set out 
that these registrations in now way viol ate the principle of national treatment.73 
 
229. Since the claims which Australia has raised are either manifestly inadmissible or unfounded, 
the EC does not consider it necessary to rely on the no tion of estoppel at this stage. However, the EC 
is ready to return to this issue at a la ter stage should the Panel consider it necessary. 
 
                                                      
71 Australia's FWS, paras. 89-92. 
72 EC FWS, para. 13 et seq. 
73 EC FWS, para. 156 et seq.