26 December 2016

Evolution of AO Institution

Key words: intellectual property, means of individualization, exclusive rights, appellation of origin, AO, registration of appellation of origin, evolution of AO, development of AO, geographical name, geographical indication

The AO is an appellation of origin, which is, in some way, a unique subject-matter of intellectual property. To begin with, let us briefly consider the provisions of the Russian legislation concerning the registration and operation of the exclusive rights to the AO.

In accordance with Article 1516 of the Civil Code of the Russian Federation, the appellation of origin shall be “... a designation that represents or contains a contemporary or historical, official or unofficial, full or abbreviated name of the country, city or rural settlement, locality, or other geographical object and also a derivative of such appellation which became known as the result of its use with respect to the goods, the special properties of which shall be defined exclusively or mainly by the natural conditions and/or human factors specific for the particular geographical object.” [“The Civil Code of the Russian Federation (Part Four)” of 18.12.2006 No. 230-FZ].

This definition allows identifying the main features of the AO, enshrined in the current Russian legislation:

1. The AO is the name of a geographic object. Any names that would create with the consumer an associative connection with a particular place of the manufacture of the goods can be used as a geographical name. At the same time, “... the designation, although representing or containing the name of a geographical object, but which has come into the public use in the Russian Federation as a designation of the goods of a particular kind not connected with the place of their manufacture shall not be recognized as an appellation of origin” (Clause 2 of Article 1516 of the Civil Code of the Russian Federation). So, designation “Dutch cheese” will not be registered, as it has come into the public use and achieved a dominant position in the Russian market as a trade name of the product.

There is also one exception for this feature: the provisions of the Civil Code relating to the AO “... shall be applied accordingly to a designation that allows to identify the goods as originating from the territory of a particular geographical object and, although it does not contain the name of this object, it has become known as a result of the use of this designation with respect to the goods, the special properties of which meet the requirements specified in the first paragraph of this Clause” (Clause 1 of Article 1516 of Part 2 of the Civil Code of the Russian Federation).

2.  The existence of a geographical environment that includes the natural conditions (the climate, soil characteristics, natural raw materials, etc.) and/or the human factors (the special recipes, production technologies, special occupational skills specific to the population of a particular locality).

3. The presence of special properties of the goods. This requirement does not imply any better qualities of a particular product (consumer properties). The product must have exactly unique, special properties (not connected with the quality), and the manufacture of the goods with such properties should be constantly possible for quite a long period.

4. The functional dependence of special properties of the goods on the geographical environment. The goods manufactured within the boundaries of a particular geographic object, but not having the aforesaid special properties, can not be marked with the AO.

5. Popularity. The goods with special properties should be produced for quite a long period within the given geographical object and marked by the AO, thus it should has obtained a certain popularity before filing the application for registration of the appellation of origin.

The exclusive right to the AO can be obtained through its registration with Rospatent – the Federal Executive Authority on Intellectual Property, by filing an application. The exclusive right is valid only on the territory of the Russian Federation. The legal protection of the appellation of origin registered abroad is usually carried out only if there is the legal protection in the country of origin of the goods.

So, if the AO is not registered, at first the application for registration of the AO and for granting the right to use this AO (by one or more individuals or legal entities) shall be filed. In case of a positive decision made as a result of the consideration of this application, the AO shall be registered, it shall be assigned a number, and the applicant (applicants) shall be given a certificate for the right to use this registered AO (the exclusive right shall be granted). Subsequently, such an exclusive right can also be granted to any persons, who manufacture the goods with the same special properties within the boundaries of the same geographical object.

Thus, the holder of the exclusive right to the AO shall not have a “monopoly” to use it (unlike, for example, the right holder of a trademark). He can “separate” the rights of the use with an unlimited number of individuals. He also can not dispose of his rights. That is, the right to the AO shall be inalienable; its holder shall not have the possibility to grant the license to anyone.

The duration of the AO is not limited by any time frames. But the duration of the right of the use of the AO shall be the same as in the case of trademarks, 10 years with the possibility of a subsequent extension. At the same time, in order to extend the duration of the certificate, it is necessary to obtain a repeated grant of the conclusion of the competent authority confirming that the right holder manufactures the goods, whose special properties are determined by the natural conditions and/or human factors, characteristic of a particular geographical object.

When considering the AO, it is necessary to remember that this institution “interacts” with trademarks in a special way. The existence of a certain similarity between the trademark and AO makes it possible to use and register the AO as a part of the trademark, and also in parallel with it. However, such a phenomenon is simultaneously a source of conflicts and restrictions: thus, in accordance with Clause 7 of Article 1483 of the Civil Code of the Russian Federation “...The designations can not be registered as trademarks with respect to any goods, if they are identical or confusingly similar to the application of origin protected in accordance with this Code, as well as to the designation applied for registration as such before the priority date of the trademark ...” In accordance with Clause 3 of Article 1488 of the Civil Code of the Russian Federation, “...The alienation of the exclusive right to a trademark including as a non-protected element an appellation of origin for which the legal protection has been granted within the territory of the Russian Federation shall be allowed only if the recipient has an exclusive right to such an appellation.”. In accordance with Clause 4 of Article 1499 of the Civil Code of the Russian Federation, “The decision on the official registration of a trademark may be revised by the federal executive authority on intellectual property prior to the registration of the trademark in connection with ... the official registration as an appellation of origin of the designation, which is identical or confusingly similar to the trademark indicated in the decision on the registration.” 

Regarding the issue of the evolution of institution of the appellation of origin, it is interesting to note that the AO is considered a rather new concept (with many peculiarities). This is added to the fact that since the ancient times primarily the geographic indication of the locality has been used for the designation of goods. This helped to distinguish the products of the same kind manufactured in different states, localities and cities.

This “novelty” can be traced both in the international law and in the foreign legislation. In the Paris Convention of 1979 term “trademark” is used extensively, but there are only indirect indications to the AO [The Paris Convention for the Protection of Industrial Property (amended on October 2, 1979)]. In the world practice there is not even a single term: in addition to “appellation of origin,” terms “geographical indication” (which is somewhat wider by meaning than the AO), “indication of origin,” etc. are used. There are opinions in the scientific literature that the concept “geographical indication,” as an individual, special object, “related” to the AO, with its own special regulation should be introduced in the Russian legislation.

Not in all countries the legal system has a clear concept of the AO as an independent legal institution. And its status as belonging to a particular category of the subject-matters of intellectual property is also different.

All this determines the fact that the AO can be called a very rare subject-matter: the AO comprises only about 5-10% of the designations used for marking the goods (the rest are trademarks). In Russia, there are not so many well-known AO: Gzhel, Vologda Lace, Vologda Butter, Khokhloma, Tula Honey-Cake, Orenburg Downy Shawl, etc.

To increase the importance and availability of the AO for the Russian market is possible in different ways. First of all, we are talking about the improvement of the Russian legislation, which should increase the number of the applications filed, their quality, shorten the terms of their consideration, make processes of the examination of such applications and granting the exclusive rights to the AO as transparent as possible and understandable to the applicants and the rights holders. All this should be accompanied by a simplification of the office work, eliminating unjustified administrative barriers and preventing unfair competition.

In addition, it must be remembered that, with all its relative “underdevelopment,” the institution of the AO is no less essential than other subject-matters of intellectual property: it performs distinctive, informative, advertising functions and identifies the source of the manufacture in both a narrow and a broad word sense. It is used to protect the legitimate rights of the persons concerned; it serves the interests of both the manufacturers and the consumers of the goods.  And summing up, we can say that to ensure the effective functioning and development of the market, it is necessary to use actively and improve the mechanisms and institutions stipulated by the legislation, in particular, the institution of the appellation of origin.

Head of Trademark Department / Trademark Attorney Reg. № 1258 / Patent Attorney of the Russian Federation / Eurasian Patent Attorney Reg. № 63