WRITTEN QUESTION E-0794/01

by Luigi Vinci (GUE/NGL) and Fausto Bertinotti (GUE/NGL) to the Commission

(13 March 2001)

Subject: Pernod-Ricard and Havana Club Rum

In 1999 the USA took legal proceedings, under the so-called Helms-Burton law, against Pernod-Ricard, which had begun negotiations with the Cuban Government with a view to becoming joint proprietor of Havana Club Rum, a Cuban company. This had formerly belonged to U.S. citizens, and had then been confiscated in its entirety by the Cuban Government. The European Commission subsequently lodged an appeal against the USA with the World Trade Organisation, on the grounds that it was invalid to claim that legal persons not having U.S. nationality and operating outside the USA were obliged to comply with US legislation.

Can the Commission provide information on the progress of these proceedings, and the probable outcome?

Answer given by Mr Lamy on behalf of the Commission

(14 May 2001)

In September 2000, the Community requested the establishment of a World Trade Organisation (WTO) panel on Section 211 of the 1998 United States Omnibus Appropriations Act.

It is important to note that Section 211 does not deal with the issue of the expropriation of trademarks or other intangible or tangible assets by the Cuban Government. Section 211 only deals with American trademarks, i.e. trademarks registered in the United States itself. Ownership of such trademarks could not have been affected by the confiscations operated by the Cuban authorities in Cuba, as the American courts have never recognised any effects of Cuban expropriations on the ownership of assets located in the United States.

Section 211 applies to situations where the original American trademark (i.e. the trademark held by the owner of the expropriated Cuban trademark) has ceased to exist, e.g. for lack of renewal by its owner, or where such a right has never existed in the United States. It disallows any transaction related to the registration and renewal in the United States of trademarks where a Cuban national, or Cuba, has an interest, taking away over time existing American trademarks from their lawful owners, as they will no longer be able to renew the trademark registration. Section 211, moreover, prohibits American courts from enforcing any such American trademark in the United States on the request of a Cuban national or any foreign successor-in-interest. In other words, it deprives the trademark of any practical value because a trademark cannot be enforced in any other meaningful way than through recourse to the Courts.

The Community considers that Section 211 entails a denial of trademark rights, which is in breach of several provisions of the WTO Agreement on Trade-Related Intellectual Property Rights. The Community's WTO case is in the interest of all Community holders of an American trademark legally acquired directly or indirectly from a Cuban owner, which are potentially affected by Section 211.

The Community has already made its views known to the panel, both orally and in writing. The second and last hearing before the panel took place on 7 March 2001. The panel is now examining the case and is expected to rule on the issue by May 2001.