Abstract
A geographical indication (GI) defines a product as being from a certain place, when the product’s quality, reputation, or other attributes are largely related to its location. GI is a collective property, not a private one. It can be registered by an organisation representing the interests of a group of people in practically all nations. GIs helps in achieving and boosting rural development, environmental sustainability, consumer awareness and many other aspects. GIs are especially beneficial to agricultural product producers since they allow them to differentiate their products from common commodity items such as rice, coffee and tea, allowing them to get market access. A sturdy GI ecosystem has numerous advantages. It will automatically address the three contentious issues faced by India—poor pay for talent, low female labour force participation and urban migration. On the evolution side, some GIs have resulted in improved and superior uniqueness of rural employment.
Introduction
It is an aged notion that products have a reputation attached to their places such as textiles (silk), minerals (e.g., marbles), art objects (e.g., ceramics, pottery, bronze, or terracotta), processed agriculture products (honey) and perfumes (incense). These examples from antiquity demonstrate that the types of things known for their locations of origin are virtually endless. A geographical indication (GI) defines a product as being from a certain place, when the product’s quality, reputation, or other attributes are largely related to its location. This definition from World Trade Organisation’s Agreement on Trade-Related Aspects of Intellectual Property (TRIPS) is the result of this notion. However, as a part of the Common Agricultural Policy, GIs are still confined to agricultural items and commodities, as well as wines and spirits, in several nations, notably in Europe (Vivien, 2017). GIs are, therefore, based on a conceptual framework of communal claim linked to producers’ artisan skills and locally developed public goods as an asset embracing local communities’ culture, history and customs (Taylor & Taylor, 2017).
It is a challenge to study GIs as they objectify actual places and to lay hold of the entire situation in any one case requires a more comprehensive outlook. At a first glance, it might look like a confined topic but in general, it is a fairly extensive topic and covers all the aspects of territorial relations, commodity chain analysis, global trade channels, rural development and tourism, effects on the environment, policies related to agriculture, and last but not the least, legal issues related to intellectual property (IP). And these are only the topic’s most realistic or tangible features. While looking into the broader picture of the interesting subjects of GIs, other aspects must be taken into consideration, such as cultural affinity and pride, local heritage and culture, and the broader social and cultural shifts that occur when civilisations progress (Barham & Sylvander, 2011). GIs are important for the producers of agricultural products as it helps in inflating access to the market and authorise them to distinguish their products from general items such as coffee, tea and rice. As items are differentiated by their origins, it helps in gathering competitive prices because of the increased value that some customers put on items.
Those indications which identify a good because of its origin in a particular locality, region, or territory wherein the traits, reputation and quality are fundamentally attributable to its geographical origin are known as GI. GIs act as a source indicator, and hence, are much alike trademarks. However, the point of distinction is that in trademarks, goods, or services identified from a particular producer and in GIs, the geographical region from where the products or services originate are identified instead of a producer (Sarkar, 2017).
As per the TRIPS Agreement,
Geographical indications are, for the purpose of this Agreement, indications which identify a good as originating in the territory of a member, or a region or locality in that territory, where a given quality, reputation or other characteristics of the good are essentially attributable to its geographical origin.
Article 22.2 of the TRIPS Agreement raises an obligation to protect GIs of countries. WTO members are required under this provision to provide legitimate means to prevent interested parties from: (a) use of any means which deceives the public through any method which implies that the good presented or product in question derives its geographical existence other than the genuine place of origin; (b) any use, defined under Article 10 bis of the Paris Convention, as an act of unfair competition (Blakeney, 2021).
The TRIPS Agreement does not specify how governments should enact legislations to prohibit the misappropriation of GIs. It is perceived that to protect GIs as a definite species of intellectual property right (IPR), around 111 countries have framed sui generis legislations and 56 countries reckon on the protection through trademark system of laws. Sui generis protection is a type of IP right that has been specifically enacted to cope with it. Europe originated the sui generis protection to safeguard wines, spirits and foodstuff (Blakeney, 2021).
A GI is a term or symbol used on items that have a specific geographical origin and have traits or reputations that are related to that location. As a result, all GIs belong to particular geographic places. It serves as proof that the product has particular attributes and a certain reputation solely because of its location of origin. It gives a high level of reliability and originality that is primarily and alone traceable to its origin in that particular geographical place, region, or nation. Though, it is not necessary that GI must consist of the name of the location where goods have originated such as Bikaneri Bhujia, Darjeeling Tea, Agra Petha and so on. Other geographical indicators do not have geographical names attached to them such as Alphonso mangoes from the Ratnagiri District of Maharashtra. GI is a collective property as it can be registered by an association of small groups of persons, in almost all countries, and is not a private right. As a result, the right acquired from GI registration is not a private monopoly. It is public property owned by the manufacturers of the product in question (Lukose, 2007).
Rationale Underlying Protection of Geographical Indications
Since the inception of the concept of Geographical Indications which can be traced back to fourteenth century, GIs have obtained invaluable fame which can be misinterpreted as a fraudulent commercial businessman. The unauthorised use of GIs is harmful to consumers and legal manufacturers. Anybody can represent a product as if it is originating in a certain location when it does not, if not adequately protected. The purchaser will be duped into believing that they are purchasing an original product with specific attributes and quality. However, they are receiving worthless replicas. This results in the damage that has to be suffered by legitimate producers, since the reputation established for their product will be jeopardised, and hence, their valuable business will be stolen away from them (Lukose, 2007).
There are several reasons for obtaining GI protection. A few of these are as follows:
Inflated economic growth: The overall lucrative success of the producers and manufacturers depends on the protection of GIs. Promoting and marketing GI-tagged products improves regional economic growth as it increases ancillary economic activity in that particular region. A favourable image and reputation of the product are created in the eyes of customers with the protection of GI which results in rewarding producers with benefits. Interception of unauthorised use: The registered holder of the GI tag has full legal rights to prohibit anyone from using their GI tags who is not from the GI region. To protect their reputation, the owners might potentially take legal action against the illegal user. Expanded businesses: The primary goal of registering a geographical indicator is to protect citizens for certain items manufactured in a specific geographical locations, which stimulates and drives marketers to develop their company on a worldwide scale. Protected GIs improve exports which, in return, enable the producers to make a good living. Encouragement of tourism: Worldwide recognition for the products can be built through protected GIs. Through these registered GI products, people around the world will tend to be motivated to visit those places and utilise such GI-registered products. As a result, it contributes to the expansion of that region’s tourism economy (KIPG, 2019).
Problem Statement
It is essential to register GIs, but what is their influence on society, and how does this benefit the community’s economy? The answer to this question is detailed below where it is shown that after registering a product as a GI, its economic value increased and it is evident from many studies.
GI as a Development Tool
The European Communities mentioned in 2003 that GIs are important to the European Union (EU) economy because they contribute positively to producers, account for a significant portion of agri-food exports and provide a segment for the growth of agri-food industries in comparatively small agricultural economies. It is believed that geographical indications are the key component of the EU’s quality policy on agricultural goods. In 2004, the food products that bore GIs had a turnover of €18 billion out of €123 billion for the food businesses in France, representing 15% of worldwide industry revenue. Likewise, export figures revealed that shipments of food goods with GI were €11 billion, accounting for 30% of overall food exports worth €38 billion. These outstanding results, which attest to the big success of GIs in Europe, have piqued the attention of emerging nations in GIs during the last decade, and it has been suggested that GI may be a helpful development instrument. Developing nations are offering a wide variety of unique traditional items; however, only a handful are well known on a worldwide scale. Both domestically and globally, the geographical indicators system can revolutionise a wide range of products (Zografos, 2008).
World Intellectual Property Organisation (WIPO) reveals that in 2018, the total number of registered GIs was 65,900 from the 92 national/regional authorities. Furthermore, to avoid double accounting, the 4,968 EU GIs in existence in all of the 28 EU member-states were tallied once instead of being multiplied by the 28 (WIPO, 2019). The majority of these registered GIs were in the agriculture and food sector having total trade of more than USD 50 billion. Many of these were highly recognised globally, such as Basmati rice, Idaho potatoes, Darjeeling tea, Parmigiano-Reggiano cheese, Bordeaux wine and Comté cheese, but several were well known in their home markets, and others were hoping for a spike in their popularity as a result of GI certification. Even though Organisation for Economic Cooperation and Development (OECD) nations contributed 90% of registered GIs, developing countries were showing their interest in GIs (Garcia et al., 2019).
As per the survey by OECD, 1995, the success of small and rural firms that target specialised consumers depends on a variety of factors. Many factors have an impact but two major factors are differentiation and market access. According to the findings of the study, one strategy to tackle these concerns is to collaborate to establish a competitive edge. This technique fits well within an origin-labelled commercialisation strategy, validating the economic case for GI protection. Nevertheless, the EU has acknowledged the GIs to be a powerful instrument of rural development, as seen in different laws and policies. For developing countries, this rural development potential might be a compelling reason to accept and promote origin-labelled products on their own soil (Bramley & Bienabe, n.d.)
Economic growth coupled with higher living standards and certain critical variables in the population’s economic and social structures results in economic development which encourages a more equitable distribution of wealth created. Certain aspects, such as economic, political and cultural, are intrinsic in ecological and social features as these elements regulate and dictate territorial development. It is believed that to achieve commercial viability, social actors must plan and form a path that needs to be reflected in the integration of strategic local activities (Garcia et al., 2019).
Socio-economic Impact of GI
One of the primary purposes of the GI law is to promote the socio-economic growth of those who produce GI items. It is important to assess if the GI registration can achieve that goal. The four basic elements that underpin GI policy are as follows.
Protection of Consumers Against Fraud
For consumers, the benefits of geographical indication protection are: (a) legal quality assurance following consumer requirements of the product; and (b) consumers are given legal assurances that the products satisfy the specified requirements. To ensure the product quality and grant rights for security and comfort to use product services entails protection of GIs. Protecting GIs results in a safe and comfortable feel among the consumers from harm when using them. Through protected GI, freedom is given to consumers that they can select goods whenever they visit a specific place and can buy products for presents or personal use (Mayasari, 2020). GIs convey information about a product for the product’s origin-bound qualities. GIs allow customers to discern between items having geographical origin-based features and those that do not, and hence, act as product differentiators in the market (Houzwala, 2020).
GI registration is procured because of several reasons but one of the primary reasons is to establish a unique reputation for the product carrying the GI tag as it helps consumers to move forward from brand awareness. GI awareness leads to the willingness of consumers to pay even a higher amount of price for the GI-tagged products while refusing others to accept as alternatives. GIs act as an essential quality indicator in the marketplace because consumer gives more importance to food safety and GIs are always linked with greater quality control. GI labelling has significant economic repercussions because of customers’ perception of GI labelling as it directly impacts customer’s choices for the GI-tagged products. An illustration of this is Galician Veal, a fresh meat product labelled as Protected Geographical Indication regulated by the EU, for which Spanish customers are more willing to pay a premium amount because of the certification attached to it which represents food quality as well as safety (Pai & Singla, 2016).
Even in nations where customers might be assumed to be more acquainted with official labels, such as Spain, Italy and Portugal, awareness remains very low. In countries like Spain, studies reveal that consumers rely for their purchase decisions solely on other sources of information such as shop recommendations as they are aware of quality labels and symbols. Public knowledge of official classification is quite low in countries such as Finland and the United Kingdom and customers appear to base their purchases of GIs on other criteria (Barham & Sylvander, 2011).
The most important factor is to provide consumers with the anticipated level of quality. In this context, quality has a wide meaning. This quality is not just associated with enhanced attributes such as improved texture, appearance or taste, but is linked with other features also such as unique origin that includes specific cultural elements like traditional events or meals. Origin delivers a distinctive characteristic to a certain product which is the basis of the product’s market-differentiation strategy, allowing it to access place-based or territorially differentiated market segments. Typicity, in their opinion, provides a one-of-a-kind market positioning potential in a worldwide market (Vandecandelaere & Teyssier, 2018). If there is no certification, consumers have no way of knowing the quality of goods that they are purchasing and they can assume an ‘average’ quality. The effect of certification of the product is seen when two types of manufacturers certify their products, one of high quality and the other of low quality; consumers will then know through the certificate the exact quality of a certified product (Réquillart, 2007).
Even after following the Paris Convention and the Madrid Convention, restrictions regarding the use of words, phrases, pictures and symbols exist that would mislead the public regarding the geographical origin of the commodity. This could be clear, for example, by banning the use of certain famous symbols like the use of words or images such as Pyramids or the Taj Mahal to assume the good’s link with Egypt or India. As per Article 22.2(a) of the TRIPS Agreement, the proprietor of the infringing indication bears the burden of evidence in showing that customers were deceived. This principle is indirectly applied by Article 23.1 and provides for vigorous protection by forbidding the use of indications on those wines and spirits that do not belong to the place indicated by the GI in issue, even if the genuine origin of the commodities is specified (Rangnekar, 2003).
Protection of the Producer of the Good
GIs need a very low level of innovation, unlike patents. Hence, it permits a large number of manufacturers to apply for GI protection without incurring any cost and expenditure associated with innovation. It is a well-documented trait of GI that they link, by nature, to parts of tradition and culture, and this feature may even be regarded as antithetical to innovation. In determining the quality of a product, GI plays a very important role. It is critical in determining the credibility traits of a brand, especially when an original brand would be supported by a registration and certification system. Manufacturers’ organisation managed and ensured that all the production standards that are agreed upon are met. Producers can, therefore, maintain product quality by the premium pricing garnered by a GI, communicate quality and the related reputation that has been established over time and is encouraged (Blakeney, 2017).
GI products often fetch a premium price in the market because of their guarantee of authentic quality. A consumer survey was done in the EU and as per the survey people are prepared to pay extra for items whose brand quality is recognised by a GI. This contributes to increasing the revenue of legitimate producers. GI offers enormous opportunities for the advancement of the disadvantaged and underprivileged parts of society, unlike other acknowledged kinds of IP (Banerjee & Nausahd, 2010).
GIs have several fundamental characteristics which assist the economy of the area and local manufacturers. First, as much as indigenous knowledge is maintained and the indication is kept from being generic, GIs can be preserved in eternity. This implies that to reach out to the customers with the message of any further product improvement, market expenses are required. Second, this results in the benefit of the entire community which further helps in stimulating the regional economy. Third, investments are only associated with improving the reputation of a pre-existing product as GIs are not constructed but only recognised, unlike patents and copyrights. Because these types of IPs are related to producing items in the first place (Jena & Grote, 2010).
Local Regional and Rural Development
GIs can help with rural development. The right to utilise a GI typically belongs to regional manufacturers, and the additional value created by the GI thus belongs to all such manufacturers. GI goods contribute to creating local jobs as they are likely to create a luxury brand price which may eventually assist to reduce rural plight of cities. Furthermore, GI goods frequently have significant spillover impacts, such as in tourism and cuisine (Vats, 2016). Geographical signals may breathe fresh life into rural communities. In the very first case, the right owners with the potential will stand to profit economically from their GI as well as with the ability to exclude those users who are not entitled by creating a barrier to access into a specific market segment through the issuance of GI. In consequence, these characteristics will result in an equal distribution of value and advantages to GI owners and their communities (Zografos, 2008).
To develop a better market equilibrium between supply and demand, the diversified agricultural output should be encouraged. Particularly in undeserved or remote regions, the marketing of goods with specific features may be of significant value to the rural economy. This can be done by increasing farmers’ income and maintaining the rural people in these places. The preservation of GIs, which creates local jobs, is a factor driving rural migration, which is especially essential in developing nations. The most disadvantaged of the rural areas are considered to be the young people and their departure poses a threat to the viability of rural communities (Blakeney, 2021).
Conservation of Biological Resources, Biodiversity and Cultural Diversity
GIs aided in the enhancement of soul fermenting potential, in the preservation of biodiversity on the property and the surrounding areas, in suppression of bio-piracy, and the preservation of local cultural heritage and traditional know-how. Certain factors play a role in explaining the product’s reputation such as high levels of biodiversity, the environment, distinct local genetic or biological resources, specific geography, or good farming methods even though the fundamental goal of GI was not to safeguard biodiversity. GIs preserve the ecology which is required to generate the good which further contributes to the preservation of biodiversity. The expansion of agro-industrial generic goods forces small and medium farmers by creating challenges to concentrate their resources in a specific market that prioritises environmental protection, terrain conservation and organic food. Certain agricultural products, for instance, the European Olive Oil industry, has many positive impacts on the environment such as enhanced fire-risk control, relatively low-levels of soil erosion, energy and water conservation, reduced pollution and elevated numbers of biodiversity and genetic diversity in olive-tree varieties. Research on the conservation of Coorg Coffee in the Western Ghats of India concluded that a GI suited to Kodagu might contain requirements adjusted to incorporate biodiversity-friendly techniques suited to a specific environment. However, it was discovered in this study that a GI based on the reputation of the landscape will stimulate biodiversity conservation only if it is successful in luring customers to a coffee coming from a biodiversity-preserving production method (Basheer, 2021).
Economic Implications of Geographical Indications
A robust GI ecosystem has numerous advantages. Given India’s traditional trade guilds, ethnic diversity and cultural richness, the GI sector has the potential to be a source of both economic and soft power. Additionally, it will automatically address the three contentious issues of low pay for talent, low female labour force participation and urban migration.
In the beginning, it will give rise to a new class of entrepreneurs, gig workers and a ‘passion’ economy, or a new way for people to monetise their skills and exponentially grow their businesses. By connecting them with sincere, active communities that share their passion, this gives creators the platform. These connections make it easier for people to work as freelancers and generate a steady income from sources other than employers. In addition, by monetising artisanal work done at home, the low female-labour-force participation rate, which at 21% in 2019, was at half of the global average, will be addressed. The employment-to-population ratio in India is an appalling 43% compared to the global average of 55%. Additionally, because GI is so hyper-localised, it is one of the potential solutions to halt urban migration. Because GI tourism is typically a byproduct of a strong GI ecosystem, a robust GI ecosystem will additionally possibly encourage reverse migration but also serve as the conservator of our ancient crafts, culture and food. Third, because GI is so hyper-localised, it offers one potential means of halting urban migration. Reverse migration may be induced by a healthy GI ecosystem, which will also protect our traditional arts, cuisine and culture. GI tourism, another source of income, is frequently a result of a robust GI ecosystem (Fernandes, 2022).
GI products have a sizable market, particularly in the United States and Europe. Globally, GI products are thought to be worth well over US$ 50 billion in sales. Wines and spirits make up the majority of that. Several nations, including Scotland, Australia, China and Chile, have GI exports that exceed US$ 1 billion. There are not many detailed estimates available for the various origins, but data for France indicate that the market value of their GI products is close to €19 billion, or about 10% of the total value of the country’s food market. The 430 GIs in Italy produce about €12 billion in revenue and employ about 300,000 people, whereas the 133 GIs in Spain produce about €3.5 billion. It is more challenging to find economic data on developing nations. Approximately, ₹28 billion worth of Basmati rice and ₹917 million worth of Darjeeling tea were exported from India in 2009–2010. Blue Mountain green coffee brought in US$ 24 million for Jamaican exporters in 2008, and the export sales of tequila were estimated at US$ 725 million in 2007. The number of people employed in the nation increased to 80.30 lakh in 2014–2015 from 78.50 lakh in 2013–2014, representing a growth of 22.9% (Vats, 2016).
E-commerce has contributed to a 16% increase in the volume of China–EU agricultural trade to $19.4 billion just in the first couple of months of 2021. Likewise, exports of wine from the Ningxia region of China increased 46.4% in 2020 despite a generally weak wine market, benefiting 211 Ningxia wineries. As of 2020, GI producers in China generated $92.771 billion in output. A 2019 report found that the EU’s GI economy is worth $87 billion. According to a number of studies, copyright and patent protection for goods covered by GIs boosts economic growth while also encouraging higher-quality production and more equitable profit distribution (Fernandes, 2022).
Recent trade agreements amply demonstrate the political weight that GI policy has for the EU. The EU has once more made it known that GIs are a crucial component of any trade agreement in the ongoing negotiations with both Australia and New Zealand. Given their modest economic contribution to domestic production and global trade, this may come as a surprise. According to research findings that were published in 2019 on an average, GI products made up about 7% of the national food and beverage market in the EU member-states in 2017. Furthermore, only 22% of EU GI products are exported outside of Europe, while 58% of production is sold in domestic markets. A total of 90% of GI exports are wine or distilled spirits. Italy has the most GIs in Europe as of 2019 with 299 foods and 526 wines, with an estimated €16 billion in total agri-food GI turnover, with €3.5 billion coming from the wine industry. Italian GI wines made up 35% of all GI wines in Europe in 2019 (Ricardo et al., 2021).
Even though research suggests that it is possible to boost production volume, producers might have trouble balancing supply and demand. Large processors have expressed interest in buying their products, but the sale is impossible because of their production scale, which can only supply to a small market. Producers must cooperate with one another in order to access a GI because certain requirements must be met collectively. However, one of the difficulties for GI’s success is frequently viewed as the absence of a representative organisation or the existence of organisational issues. It is also important to note that the difficulty of establishing an appropriate form of governance increases with GI size, which can result in the area being controlled by strong corporations and the marginalisation of farmers who produce traditional goods (Cardoso et al., 2022).
Suggestions and Recommendations
To contribute to the policy objectives such as conservation of biodiversity and alleviating poverty, GIs must develop and improve as a groundbreaking axis to comprehend regional value chains in the context of rural development and growing suburban and urban populations in developing countries and not only as an IPR about the use of geographical names in the trade. The question is whether circumstances for promoting ecological integrity and alleviating poverty can simply be a guideline to all stakeholders, particularly authorities in charge of GI surveillance and registration or it should have been included as a mandate by law in national legal frameworks on GIs (Vivien & Chabrol, 2014).
Concerns for the environment and biodiversity have yet to be adequately addressed in any national standards for GI designation. Furthermore, the legitimacy of their inclusion is fiercely disputed and challenged. Many stakeholders do not see how or why GIs could be utilised as policy instruments to conserve biodiversity while biodiversity is essential to discussions about environmental sustainability and is implied in the uniqueness of many GI goods. Rather than focusing on the environment, these stakeholders’ core strategic orientation always focuses on the product such as physical features of the product like taste instead of ethical ideals. Their focus is always on prospects for sales and trade of well-known items rather than on local variety. The complicated games performed by multiple local and national players in the realm of a quality policy, which frequently results in the rivalry between quality indications, such as organic and GI, rather than an integrated approach, adds another layer of intricacy (Lockie & Carpenter, 2010).
To achieve maximum benefit with registered GIs, the following points are important:
To increase a product’s reach, an effective marketing strategy for GI products is required. Use a GI mark authorised by the government for the same. The customer’s requirements for any product to compete on the market are quality and safety. A genuine and standardised product ought to be created. Unauthorised copiers must be checked in order to preserve brand value. The new entrants into the market should be monitored by the GI producers. Products with global significance should be kept separate for export. Indian spices, tea and handicrafts, for instance, are in high demand on the international market; producers should locate this market. Traditional knowledge and traditional culture are also covered by GI protection. There is also a need for preservation. The Indian Ayurveda was viewed as having great potential for treating Covid-19; however, traditional knowledge must be preserved. GI has enormous potential to spur economic growth. The use of GI as a tool for 2020–2025 development plans should be encouraged by policymakers.
Conclusion
The TRIPS Agreement’s needs for nations to implement GIs protection has resulted in significant legislative action across the world, although the top-down imposition of GIs rules has tended to run ahead of producer’s enthusiasm. In poorer nations, a key restriction is the lack of market expertise and financial resources to sustain the commercialisation of GI goods and it has been noted that expensive market efforts are because of the frequently transitory nature of consumer demand that results in high-risk investment. In certain countries, this cost can be offset if the advocacy of GIs is linked with the development of agritourism, or if initial financing is supplied from the national budget, as the tourist authorities of Malaysia and Thailand have done. A GI product’s typical quality changes within the area of the producing region and well within the community of producers and manufacturers are because of variation in technology and culture. These adjustments can travel in the opposite direction and harm the GI’s reputation and can also boost the product’s market in a successful market expansion trajectory. There is no one-size-fits-all answer to this sort of governance and management problem. Various legal systems, with varying levels of protection and degrees of flexibility, and different types of social organisation of marketing and production chains, can help to spread original products all through the market and protect the use of GIs.
Footnotes
Declaration of Conflicting Interests
The authors declared no potential conflicts of interest with respect to the research, authorship and/or publication of this article.
Funding
The authors received no financial support for the research, authorship and/or publication of this article.