Member Article

The Court of Justice of the European Union (CoJ) handed down an important judgment last week on the protection of geographical indications of spirit drinks in a preliminary ruling under Article 267 of the Treaty on the Functioning of the European Union (Scotch Whisky Association (SWA) v Michael Klotz (Case C-44/17)).

Facts: Mr Klotz markets a whisky under the designation ‘Glen Buchenbach’, which is produced by a distillery located in Berglen in the Buchenbach valley in Germany. The label on the bottles includes the following: ‘Waldhornbrennerei [Waldhorn distillery], Glen Buchenbach, Swabian Single Malt Whisky, Deutsches Erzeugnis [German product], Hergestellt in den Berglen [produced in the Berglen]’.

The SWA took the view that the term ‘Glen’ (i) infringed the registered geographical indication ‘Scotch Whisky’; (ii) would cause consumers to make an inappropriate connection to the registered geographical indication; and (iii) would mislead them as to the true origin of the whisky in question. The SWA brought an action before the German Regional Court in Hamburg requesting that it order Mr. Klotz to stop using the designation ‘Glen Buchenbach’ for that whisky. The CoJ was asked by the German Court to interpret the EU rules on the protection of registered geographical indications applicable to spirit drinks (including in light of Regulation (EC) No 110/2008 on the definition, description, presentation, labelling and the protection of geographical indications of spirit drinks (Regulation)).

The CoJ found that:

• The decisive criterion for finding there to be an ‘evocation’ of the protected geographical indication is whether, when an average European consumer who is reasonably well informed and reasonably observant and circumspect, is confronted with the name of the product concerned, the image triggered in his/her mind is that of the product whose indication is protected. That is a matter for the national court to determine, taking into account the partial incorporation of a protected geographical indication in the disputed designation, any phonetic and/or visual similarity between that designation and that indication, or any conceptual proximity between the designation and the indication.
• For the purposes of that determination, account is not to be taken either of the context surrounding the disputed element, or the fact that that element is accompanied by an indication of the true origin of the product concerned.
• The national court will have to determine whether an average European consumer thinks directly of the protected geographical indication ‘Scotch Whisky’ when confronted with a comparable product bearing the designation ‘Glen’.
• It is not sufficient that the disputed element of the sign at issue evokes in the relevant public some kind of association with the protected geographical indication or the geographical area.
• For the purpose of establishing that there is a ‘false or misleading indication’, as prohibited by the Regulation, account is not to be taken of the context in which the disputed element is used. The Regulation’s objectives (in particular the protection of registered geographical indications in the interests of consumers and of economic operators bearing higher costs in order to guarantee the products’ quality) would be jeopardised if that protection could be restricted by the fact that additional information is found alongside an indication which is false or misleading.

Comment: For products marketed in the Ireland and other parts of the EU in similar circumstances to the Mr. Klotz case, in deciding whether there is an ‘evocation’ prohibited by EU law, the national court has to determine whether a consumer thinks directly of the protected geographical indication when he/she sees a comparable product bearing the disputed designation. It is not sufficient that the designation is liable to evoke, in the consumer concerned, some kind of association of ideas with the protected indication (or the relevant geographical area). The test may become a challenging one to apply in practice depending on the product at issue and it may be that application of the test outlined above might vary from one Member State to the next even where the facts are similar.

For further information, contact Alan McCarthy, Partner, or any member of the EU, Competition & Procurement team at A&L Goodbody.