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GIs to benefit European and Vietnamese firms

13/03/2019

In addition to benefiting from import tariff cuts, under the EU-Vietnam Free Trade Agreement, European businesses will be able to have their products protected in Vietnam, to which they can boost exports on account of the nation’s commitments in protection of geographical indications.

On March 11, Deputy Prime Minister, Minister of Foreign Affairs Pham Binh Minh stated that this year, the Minstry of Foreign Affairs and the Vietnamese government will continue working with European nations regarding the signing and adoption of the EU-Vietnam Free Trade Agreement (EVFTA).

The EVFTA is being submitted to the European Council for official signature which is to take place in this year, with approval by the European Parliament. On October 17, 2018, the European Commission adopted the deal.

The European Chamber of Commerce in Vietnam (EuroCham Vietnam) said that the protection of geographical indications (GIs) was a key interest for the European Union during the negotiations of the EVFTA, as it represented a large potential market for small- and medium-sized EU enterprises. The adopted text of the EVFTA is meant to set higher protection for intellectual property rights in the field of GIs.

A GI is a distinctive sign which is used to identify a product as originating in the territory of a particular country, region or locality where its quality, reputation or other characteristic is linked to its geographical origin.

In fact, the EU supports better protection of GIsinternationally due to the increasing number of violations throughout the world as geographical names with commercial value are exposed to misuse and counterfeiting. The abuse of GIs limits access to certain markets and undermines consumer loyalty. Fraudulent use of GIs hurts both producers and consumers.

Thanks to the EVFTA, European farmers and businesses producing food and drink using traditional methods, which are protected by 169 European GIs,will benefit from recognition and protection on the Vietnamese market at a comparable level to that of EU legislation. This means that the use of GIs such as Champagne, Feta, Parmigiano Reggiano, Rioja, Roquefort or Scotch Whisky will be reserved in Vietnam for products imported from the European regions fromwhich they originate.

“This protection will be assured on the Vietnamese market by appropriate administrative sanctions, including upon request of an interested party and will apply once the EVFTA enters into force,” said a guide to the EVFTA.

The listed GIs will benefit from direct protection through the FTA, which will provide for the legal basisto challenge any usurpation of the EU GIs, with only very limited exceptions: specific solutions were agreedfor five EU GIs (Asiago, Champagne, Feta, Fontina and Gorgonzola), addressing possible coexistence with prior registered trademarks or uses in Vietnam.

Meanwhile, about 39 Vietnamese GIs will also be recognised and protected as such in the EU thanks to the EVFTA, providing adequate framework for further promoting imports of quality products such as Phú Quốc fish sauce, Mộc Châu tea or Buôn Ma Thuột coffee.

The automatic registration and protection of 169 listed European GIs and 39 Vietnamese GIs is one of the major provisions of the EVFTA, and “This should help boost foreign investment in Vietnam and reassure European investors on the country’s commitments to protect foreign GIs,” said EuroCham’s EVFTA report 2018.

“A higher level of protection in the EVFTA is also ensured through the refusal to grant GI protection to a product using a designation or presentation misleading the consumer on its origin or nature, notably through the use of expressions such as ‘kind’, ‘type’, ‘style’, or ‘imitation’. This is a great improvement for GI protection in Vietnam,” the report said. “The higher level of protection of EU and Vietnamese GIs is a significant achievement for the development of IP regulations in the country and the attractiveness of the Vietnamese market to foreign investors.”

However, according to EuroCham Vietnam, Vietnamese consumers and businesses have little knowledge of GIs and of the differences between products benefiting from GI recognition and other similar goods. The procedural length of registration of GIs and the overall difficultly in enforcement of intellectual property rights in Vietnam also pose a serious threat to the application of EVFTA provisions.

Despite gaps remaining between the provisions of the EVFTA and of the Vietnamese Law on Intellectual Property, authorities are pursuing efforts to amend conflicting regulations so as to ensure a complete and effective implementation of the EVFTA before its entry into force.
Great benefits

The EVFTA will virtually eliminate all tariffs on goods traded between the two sides. It also includes a strong, legally binding commitment to sustainable development, including the respect of human rights, labour rights, environmental protection and the fight against climate change, with an explicit reference to the Paris Agreement.

According to the European Parliament, the EU hoped that an FTA with Vietnam will boost trade and investment.

“The FTA is also an important stepping stone to a wider EU-Southeast Asia trade deal, something which the EU has been striving towards for nearly a decade,” the parliament said. “Vietnam, a fast-growing and competitive economy whose bilateral trade with the EU has quintupled over the past 10 years, is equally keen on the deal, which could potentially boost its GDP by 15%.”

“The trade and investment agreements with Vietnam are exemplary of Europe’s trade policy. They bring unprecedented advantages and benefits for European and Vietnamese companies, workers and consumers. They take fully into account the economic differences between the two sides,” said Jean-Claude Juncker, President of the EC.

The EVFTA will eliminate over 99% of tariffs. The EU will eliminate duties for thousands of items sourced from Vietnam. Meanwhile, at entry into force, Vietnam will liberalise 65 per cent of import duties on EU exports to Vietnam, with the remainder of duties being gradually eliminated over a 10-year period.

For example, Vietnam will apply liberalisation for almost all EU machinery and appliances at the EVFTA’s entry into force, with wines and spirits after seven years, frozen pork meat after seven years, beef after three years, and dairy products after a maximum of five years.

Bruno Angelet, Ambassador and Head of the EU Delegation to Vietnam, forecast that EVFTA is expected to help trigger a new wave of high-quality investments in both directions, supported by an updated investment dispute resolution system.

Upon EVFTA’s implementation, it is estimated that Vietnam’s GDP could rise by over 15 per cent and that the value of its exports to the EU could increase by almost 35%.

Source: Nhan dan