WRITTEN QUESTION E-0121/00

by Ioannis Souladakis (PSE) to the Commission

(27 January 2000)

Subject: Breach of the EU-South African Trade Agreement

South Africa's insistence on using the protected designations ouzo and grappa on its spirits products, although they belong to the protected drinks of Greece and Italy respectively, casts doubt on the free trade agreement recently signed between the EU and South Africa. This behaviour on South Africa's conduct in this respect is causing problems in attempts at rapprochement between the two sides, especially following the abolition of apartheid and the end of the country's decades-long international isolation.

It is advisable to avoid the infringement of EU agreements with third countries at the expense of the specific interests of producer groups in Member States before the relevant agreements are concluded. Since there are many similar agreements with third countries, the responsible EU bodies should in each case take the preventive measures necessary to avoid the risk of large numbers of protected products being counterfeited.

Does the Commission take the safeguarding of protected designations for EU products into account during the conclusion of free trade agreements and what measures is it taking in this particular case to protect ouzo and grappa producers from the counterfeiting of these designations in South Africa?

Answer given by Mr Nielson on behalf of the Commission

(8 March 2000)

The negotiation of free trade agreements between the Community and third countries aims principally at eliminating trade barriers between the parties for substantially all their trade. However the agreements also deal with trade-related areas, such as protection of intellectual property. This has been the case with the Community-South Africa agreement.

The negotiations which led to the Trade, development and co-operation agreement (TDCA) were closely monitored all along by the Council, in compliance with the negotiating mandate adopted by Council, in March 1996. Their outcome received unanimous support from Member States at the European Council of Berlin in March 1999, and again in July 1999 when Council decided on the provisional application of the TDCA. In October 1999, Parliament gave its assent to the TDCA.

As regards the protection of denominations for spirits, the denominations ouzo and grappa are fully protected on the territory of the Community for the respective Greek or Italian products(1). No third country product can therefore be imported and marketed within the Community under these denominations. At a multilateral level, these two denominations are not currently protected under trade-related intellectual property measures (TRIPs) rules. However it is the Community's strategy to negotiate bilateral and multilateral agreements to secure the protection of these designations on third country markets. A number of third countries, including South Africa, remain opposed to such protection. However, the bilateral agreements concluded by the Community with Mexico and Switzerland do contain the necessary provisions for protection. Similar agreements are currently under negotiation with accession candidates and neighbouring countries as well as Canada.

With respect to South Africa, the TDCA signed in October 1999 contains a specific reference to protection of the geographical indications port and sherry which are recognised under the multilateral TRIPs rules(2). But the TDCA confirmed that protection of traditional spirits denominations such as grappa and ouzo, remain to be obtained in the separate wines and spirits agreement that has been under negotiation with South Africa for the last three years. This separate agreement was originally foreseen in the negotiating mandate on the main agreement which was given to the Commission in 1996. The Commission negotiating team has been consistently pursuing the established Community position in the matter.

In February 2000, the South African government accepted a Community proposal to protect the denomination ouzo and the other traditional spirits denominations(3) for the corresponding Community products at the end of a five year period of transition. Furthermore it was agreed with South Africa that formal negotiations of the wines and spirits agreement will be resumed in March 2000 with a view to conclusion by 1 June 2000 and entry into force on 1 September 2000.

(1) See Council Regulation (EEC) No 1576/89 of 29 May 1989 laying down general rules on the definition, description and presentation of spirit drinks (OJ L 160, 12.6.1989).

(2) See Annex X to the Council Decision 1999/753/EC, 29.7.1999 concerning the provisional application of the agreement on trade, development and cooperation between the European Community and its Member States, of the one part (OJ L 311, 4.12.1999).

(3) Grappa, Korn, Kornbrand, Pacharan, Jägertee.