• Canadian GI system protections expands this week
  • Despite safeguards, potential pitfalls for food companies
  • Lawyers expect to see infringement lawsuits

Major changes to Canada’s system of geographical indication (GI) rights come into force this week as a result of amendments to the country’s Trademarks Act. The range of goods eligible for GI rights will expand significantly, and complying with the new protections will become a more onerous task. While playing to the advantage of famous regional producers, the reforms create risks and liabilities for many food businesses previously unaffected by GI rules.

The new legislation adapts Canada’s IP laws in accordance with the country’s Comprehensive Economic and Trade Agreement (CETA) with the European Union. Most significantly, it extends GI rights – previously limited to wines and spirits – to a broad array of food and agricultural products. Its most immediate effect is to introduce roughly 170 new protected indications (almost all of which are for European produce). These significant changes also promise to attract a flow of applications from regional agricultural bodies from around the world, according to one expert. “I think there will be an increase in filings from other territories for Canadian GI”, comments Smart & Biggar’s Ekaterina Tsimberis, who represents a number of French bodies on GI matters. “Producers should see this as a new opening to acquire protections in Canada, and I can imagine certain US products – like the Idaho Russet potato, for instance – seeking these rights.” Similar predictions are made by Alexandre Ajami of Miller Thompson, who represents a variety of food and agricultural businesses and anticipates a stream of further applications from European – and possibly Canadian – agricultural authorities.

While the move is a significant expansion to Canada’s GI regime, it will also see a strengthening in these rights. Described as “super GIs” by Ajami, the 170 indications which gain instant recognition under CETA will be exempt from objection and cancellation proceedings. Furthermore, protected indications – including current wine and spirits GIs – may also become easier to enforce under the new rules. GI users will have to show not only that their products were made in the specified region, but also that they were also produced in accordance with rules of that territory. According to Tsimberis, it can sometimes be difficult to enforcing GIs solely on the basis of territorial origin, and the new rule makes it potentially easier for a responsible authority to prove infringement of its rights.

Yet, the legislation does make some significant allowances for existing operators. Indications granted, applied-for or used as trademarks before the GI gained protection will be exempt, and the use of specific cheese names – such as Feta, Munster or Asiago – will not be prohibited either if they have been used continuously for 10 years before October 2013. Moreover, terms which have acquired common usage in English and French will also be immune: Parmesan, Valencia orange and Black Forest ham are three examples. The changes will also expand the grounds for objecting to proposed GIs and create new procedures for cancelling rights.

It is crucial, however, for food companies to appreciate the pitfalls that exist despite the exceptions carved out for them. One risk, according to Ajami, is that businesses will infringe GIs by using them generically in packaging and advertising, rather than as a trademark. “Corporations often forget to make searches when using terms generically, and may infringe GIs without realising it. They may also not be aware that the exemptions for pre-existing trademark GIs do not extend to other pre-existing uses.”

Perhaps the greatest danger, according to Grant Lynds of Marks & Clerk, arises from the difficulty of interpreting the exemptions: “There are a number of exceptions, but they are very complex and it is hard to qualify what precisely they are - it will take some time for people to come to grips with them”.

As such, Tsimberis expects to see numerous infringement lawsuits between GI-protected regional producers and food companies/trademark owners in the future, adding that these will arise mainly over the nature of the exceptions and who falls under them. Potential points of contention, she suggests, include the issues of previous use, common usage, and comparative advertising. For Ajami, there is “no doubt” that litigation will arise. He adds that the question of good faith use – a condition for continued use of pre-existing trademarked GIs – could become a major battle ground.

So notwithstanding the safeguards included to protect their interests, food and agricultural enterprises in Canada should tread carefully following this week’s implementation of the new GI regime.