Canadian generic use of European wine and spirit names to end

Canada and the European Union have finalized an agreement that will commit the parties into protecting each other's geographical indications (GIs) for wines and spirits. The agreement has been approved by the European Commission and has been presented to the European Council for official ratification. The Canadian Parliament also has to ratify the agreement, but a federal election due to be called in the near future is likely to delay the process.

The main purpose of the agreement is to terminate the generic use in Canada of 21 European GIs for wine names. Article 12 proposes to phase out the use in three stages. First, the use of Bordeaux, Chianti, Claret, Madeira, Malaga, Marsala, Medoc/Médoc, and Mosel/Moselle on Canadian wines will cease as soon as the agreement comes into force. Second, the use of Bourgogne/Burgundy, Rhin/Rhine and Sauterne/Sauternes will cease by December 31 2008. Third, Chablis, Champagne, Port/Porto, and Sherry will no longer be used after December 31 2013.

Article 17 also proposes to phase out within two years the generic status of specific spirit names (Grappa, Jagertee, Korn, Ouzo and Pacharan). In exchange, the European Union will protect (i) Canadian Rye Whisky and Canadian Whisky as a distinctive product of Canada, and (ii) GIs for wines originating from Canada (ie, Fraser Valley, Lake Erie North Shore, Niagara Peninsula, Okanagan Valley, Pelee Island, Similkameen Valley and Vancouver Island).

The agreement also establishes (i) regulation of production and quality standards for wines and spirits, and (ii) fair commercial treatment by the Canadian provincial alcohol monopolies. It will be managed by a joint committee consisting of representatives from the European Union and Canada, who will meet at the request of either party. The joint committee's responsibilities include:

• amending the list of protected wines, spirits and regional names;
  
  
• arranging consultations;
  
  
• dealing with disputes including reference to arbitration; and
  
  
• terminating the agreement.

The matter of wine labelling will continue to be discussed bilaterally, in particular because of (i) the use in the European Union of traditional expressions to denote the quality of certain wines, and (ii) the need to protect these expressions in order to avoid misleading consumers. Another pending issue is the use of the term 'Highland Whisky', which will be the object of further discussions with a view to reach an agreement by June 30 2005. Such an agreement should be in line with any World Trade Organization rights and obligations, which require that the appellation should not mislead consumers as to the origin of the whisky, but should also take into account the use of the term in Canada in recent years.

For background information on the agreement, see Canada considers protecting European GIs for wines and spirits.

Toni Polson Ashton and Nicholas Julian Cartel, Sim Hughes Ashton & McKay, Toronto