Wine Law

Wine Law Estoril | Salamanca | Paris 2021


© Carlos Torres, F. Javier Melgosa Arcos, Laurence Jégouzo, Alexandra Varla, Angel Pellegrino, Alicia B. Penissi, Ardyllis Alves Soares, Carlos Armas Morales, Caterina del Federico, Charlotte de Reynal, Christine Lebel, Claudia Madrid Martínez, Duilio Cortassa, Felio José Bauzá Martorell, Francisca Ramón Fernández, Cristina Lull Noguera, Freddy Andrés Hung Gil, Gonzalo Casanova Ferro, Giuliano Lemme, Ilie Dumitru, João Amaral, Julio Facal, Mª del Mar Gómez Lozano, Marie-Elvire de Moro-Giafferri, Michael Tanti-Dougall, Nancho Nanchev, Paola Gelato, Stefano Vergano, Ricardo Poccioni, Roner Fabris, Sandra Sofía Arcos Valcárcel, Tatjana Josipović, Tomás Prieto Álvarez. ISBN: 978-989-90660-1-4 All Rights Reserved. No part of this book may be reproduced or utilised in any form or by any means, electronic or mechanical, including photocopying, recording or by any information storage and retrieval system, without permission in writing from the publisher. A written permission must also be obtained before any part of this publication is stored in a retrieval system of any nature. This work is published for general guidance only and is not intended as a substitute for professional advice. While every precaution has been taken in the preparation of the text, the publishers and authors can accept no responsibility for the consequences of any errors, however caused. This edition was published in 2021 by ESHTE, alongside other universities and institutions. ESHTE – Estoril Higher Institute for Tourism and Hotel Studies Av. Condes de Barcelona, n.º 808 2769‑510 Estoril Portugal English review: Gonçalo Vagos Diniz Structural revision: Tomás Torres Typeset by ESHTE Printed by VASP Dep. legal n.º 490003/21

Contents Zurab Pololikashvili Secretary-General, World Tourism Organization (UNWTO) 21 Raúl Filipe ESHTE President 23 Ricardo Rivero Ortega Rector of the University of Salamanca 25 Laurence Jégouzo Vice Dean of the Sorbonne Law School 29 Gilberto Igrejas President of the Porto and Douro Wines Institute 31 José Calixto President of RECEVIN 33 DESIGNATIONS OF ORIGIN / GEOGRAPHICAL INDICATIONS Tomás Prieto Álvarez Designations of Origin within the EU: Legal Challenges 35 1. Introduction; 2. Towards a Greater Conceptual Certainty Concerning Designations of Origin; 2.1. Wine European Geographical Designations’ Peculiarity; 2.2. The Controversial Differentiation of Designations of Origin and Geographical Indications; 2.2.1. Non-wine geographical indications; 2.2.2. Wine geographical indications; 3. The Nebulous Formulation of the Legal Status and Its Public-Law Nature;

8 WINE LAW 4. Preservation of the Common Market in Designations of Origin; 4.1. European and National Quality Systems for Origin-Labelled Products: Substitution or Coexistence; 4.2. Internal Distribution of Powers over Designations of Origin; 5. The Scope of Designations of Origin within the Agri-Food Sector; 5.1. Various Attempts at Regulation and the Role of Courts: Current Uncertainty in the European Union; 5.2. Scholars’ Views; 5.3. Personal Assessment; 6. Supervision of Designations: Verification of Compliance with Product Specification. Paola Gelato and Stefano Vergano The Matter of Geographical Indications and Designations of Origin in the Wine Field: Italian and European Perspectives 65 1. Introduction; 2. Geographical Indications and Designations of Origin; 3. Relationship between Designations of Origin, Geographical Indications, Collective Trademarks and Certification Trademarks; 4. Sanctions due to the Infringement of Designations of Origin and Geographical Indications; 5. Conclusions. Matija Damjan Homonymous Names of Wines and Grape Varieties: The Case of Teran 83 1. Introduction; 2. Geographical Indications and Generic Names; 3. Homonymous Geographical Indications; 4. Customary Names of Grape Varieties in Wine Labelling; 4.1. International agreements; 4.2. International Standard for the Labelling of Wines; 4.3. European Union law; 5. Dispute over Teran; 5.1. Background; 5.2. Commission Delegated Regulation; 5.3. Action for annulment; 5.4. Aftermath;

CONTENTS 9 6. Conclusion; 7. Bibliography. TRADEMARKS Marie-Elvire de Moro-Giafferri Protection of Wine Names by Trademark Law 101 Introduction; I. An Eligible Sign for Protection as a Trademark; I.1. Definition of Trademark; I.2. Distinctiveness: A Core Function of Trademarks; I.2.1. Commonplace elements; I.2.2. Lack of distinctiveness of descriptive terms; I.2.3. Three-dimensional trademarks and distinctiveness; I.3. A Lawful Sign; I.4. Lack of Deceptiveness and Wine Trademarks; I.4.1. Mandatory connection with the land; I.4.2. A mandatory connection with the wine itself; II. An Available Sign; II.1. Availability Regarding Signs in the Course of Trade; II.1.1. Availability regarding prior trademarks; II.1.2. Availability regarding prior designation of origin or geographical indication; II.1.3. Availability regarding prior signs identifying a legal entity; II.2. Availability Regarding Rights related to Personality and Creation; III. A Legitimate Sign; III.1. A Legitimate Sign at the Stage of Its Application; III.2. A Legitimate Exercise of the Trademark; III.2.1. Legitimate use made by a third party; III.2.2. Legitimate use of the prior trademark. Alexandra Varla Unconventional Trademarks in the Wine Industry 131 I. Introduction; II. The Notion of Unconventional Trademarks; III. The Value of Unconventional Trademarks and the Interdependence with Branding Strategies;

10 WINE LAW III.1. The Advertising Function of a Trademark; III.2. Examples from the Wine Industry; IV. Legal and Policy Concerns in the Registration of Unconventional Trademarks; IV.1. The Absolute Grounds for Refusal and the Doctrine of Functionality; IV.2. Cases Regarding Registration of 3D Bottle-Shapes in the Wine and (Alcoholic) Beverages Industry; IV.2.1. Coca-Cola; IV.2.2. Wajos GmbH; IV.2.3. Vinicola Tombacco and Sandro Bottega; IV.2.4. Globefill Incorporated; IV.2.5. Bacardi & Company; V. Concluding Remarks. Mª del Mar Gómez Lozano Shared-Use Trademarks for the Geographical Indications of Wine Products 155 I. Introduction; II. The Labelling of Wine Products; III. The Legal Basis for the Use of Shared Trademarks; IV. The Fairness in the Use of Shared Trademarks; V. Bibliography. LABBELLING / PACKAGING Giuliano Lemme Wine Labelling 171 1. Consumerism and Law; 2. General Rules on Food Labelling in the EU; 3. Wine Labelling: Regulations; 4. The Problem with Wine Classification: A Consumer Perspective; 5. A Possible Solution?. Duilio Cortassa The Labelling and Packaging of Wine in European and Italian Perspectives 187 1. Introduction;

CONTENTS 11 1.1. The European early framework; 1.2. The developments after 1970; 1.3. The single CMO and the labelling and presentation rules; 2. Labelling and Presentation of Wines after the 2009 Regulations; 2.1. Rules on the labelling of foodstuffs applying to the wine sector; 2.2. Harmonising the labelling for all wine sector products; 2.3. Implementing labelling and packaging rules; 2.4. The single visual field and the indelible characters; 2.5. Bottler, producer, importer and vendor; 2.6. Conflicts between the name of the bottler, producer, importer or vendor and a PDO or a PGI; 2.7. Terms referred to a holding; 2.8. Names of geographical units smaller or larger than the area underlying the PDO or PGI; 3. Wine Labelling; 3.1. Entering into force of the current CMO; 3.2. What should be indicated on the bottle of wine?; 4. The Italian Case; 4.1. Domestic law on wine labelling and packaging; 4.2. PDO and PGI in Italian law; 4.3. Details of the Italian wine labelling; 4.4. Definitions, characteristics and use of particular containers; 4.5. Names of geographical units smaller or larger than the area underlying the PDO or PGI; 4.6. Varietal wines. HEALTH Angel Pellegrino and Alicia B. Penissi Wine, Polyphenols and Health Benefits 223 Abstract; 1. The French Paradox; 2. The Healthy Components of Wine; 2.1. What is Resveratrol?; 2.1.1. Current research; References.

12 WINE LAW CONSUMER Felio José Bauzá Martorell Legal Protection of the Consumer of Alcoholic Beverages 229 I. Alcohol Consumption: Between Freedom and Administrative Intervention; II. Limitations on the Freedom of Alcohol Consumption; II.1. Principle of competition and sectoral norms; II.2. Sector limitations; II.2.1 Minors; II.2.2. Sports; II.2.3. Public order and environment; II.2.4. Road safety; II.2.5. Advertising; III. Consumer Protection; III.1. Consumer of food products; III.1.1. European legislation; III.1.2. Spanish legislation; III.2. Indication of the alcoholic content; III.3. Labelling and presentation; IV. Conclusions; V. Bibliography. Ardyllis Alves Soares Consumer Protection Related To Wine Law: A Global Perspective 247 I. Introduction; II. International Efforts of Consumer Protection; II.1. UN Consumer Protection Guidelines; II.2. International Organisation of Vine and Wine (OIV); III. Traditional Rights; III.1. Safety; III.2. Quality; III.3. Information; III.4. Choice; IV. Emerging Issues; IV.1. Sustainability; IV.2. Innovation;

CONTENTS 13 IV.3. Cultural diversity; IV.4. Digital market; V. Final Remarks; VI. References. PROMOTION / ADVERTISING Roner Fabris Wine Promotion 261 1. Introduction; 2. Usual Advertisement Rules; 3. Limits on Public Wine Promotion; 4. Wine Promotion Rules: Main Acceptable Practices; 5. Final Remarks; Examples of Wine Promotion. Charlotte de Reynal Advertising in France: A Fool’s Game? 281 Abstract; 1. Introduction; 2. The State of Loi Evin; 2.1. The Large Scope of the Law; 2.1.1. The extreme definition of “advertising”; 2.1.2. The impact on trademarks; 2.1.3. Exclusion of collective communication; 2.1.4. The total prohibition of sponsorship; 2.2. The Strict Definition of the Media Allowed; 2.3. The Strict Definition of the Contents Allowed; 2.3.1. Examples; 3. The State of Case Law; 3.1. Some Limitation of the Definition of “Advertising”; 3.2. Towards a Middle Path Regarding Sponsorship?; 3.3. The Restriction of the Media Allowed; 3.3.1. The packaging is regarded as a regulated medium; 3.3.2. Covering foils for renovated buildings is not a medium allowed; 3.4. Some Disappointed Hope for the Contents Allowed.

14 WINE LAW Christine Lebel Promoting the Wine Industry under French Law 301 Introduction; I. The 20th and 21st Centuries’ Evolution of the Hygienism Emphasis Concerning the Wine Industry; I.1. From unrestricted communications to a stricter framework for wine advertising; I.2. The particularities of wine; II. The Legal Framework for Collective Wine Advertising; II.1. The arguments supporting a ban on communications concerning consumption; II.2. The exceptions: information on the terroir and the qualities of the wine; III. The Failure of a Relaxation in Wine Promotion; III.1 Prohibited and mandatory information; III.2. Authorised media. Francisca Ramón Fernández and Cristina Lull Noguera Wine and Advertising in Spanish Legislation: Analysis of Some Controversies 321 Introduction; I. Wine and Advertising: Regulation in Spain; II. Prohibited and Permitted Acts of Advertising Relating to Wine; II.1. Designations of Origin and Protected Geographical Indications; II.2. Law on Advertising and Alcoholic Beverages; II.3. The Wine Self-Regulation Code of the Spanish Wine Federation in Advertising and Commercial Communications; II.4. Responsible Consumption of Wine: Wine in Moderation; III. Problems Raised in Relation to Minors; Conclusions; Bibliography.

CONTENTS 15 WINE SALE Caterina del Federico Wine Sale 341 Premise; 1. Some Data and Relevant Profiles; 2. Wine as a Consumer Good; 3. The Relevance of the Contract; 4. The Sale Contract; 5. The Distribution Contract; 6. Legal Framework within Europe; 7. International Sale Contract: Key Points; 7.1. Content of the Contract; 7.2. Incoterms; Final Remarks. OTHER THEMES Tatjana Josipović 353 Vineyard Register: The Role for Management of the Wine-Growing Potential in the European Union 1. EU Wine Market Organisation; 2. Vineyards and Registers; 3. Vineyard Registers in Croatia; 4. Conclusion – The Efficiency of Vineyard Registers. F. Javier Melgosa Arcos Regulation of Organic Wine in the European Union: The New Legal Framework from 2022 367 1. Introduction; 2. Background and Evolution; 2.1. EU action; 3. The Regulation of Ecological Production until 31 December 2021; 3.1. The 2007 Regulations on production and labelling of organic products and Regulations for the application of organic wine;

16 WINE LAW 3.2. The 2012 Implementing Regulations on the application provisions relating to organic wine; 3.3. New Action Plan for the future of organic production in the European Union; 4. The New Regulation of Production of Organic Wine as of 1 January 2022; 4.1. General and specific principles; 4.2. Wine production standards; 4.3. Collecting, packaging, transport and storage; 4.4. Authorisation of products and substances for use in organic production; 4.5. Labelling; 4.6. Certification; 4.7. Official controls and other activities. Carlos Torres Definition of Wine 395 1. Introduction; 1.1. Origins; 1.2. Classification; 2. The Legal Definition of Wine; 2.1. Background; 2.2. Griffe Law; 2.3. European Community; 2.4. International Organisation of the Vine and Wine (OIV); 3. Alcohol-Free Wine; Bibliography. João Amaral Spirit Drinks and Their Categories 405 1. Spirit Drinks; 2. Other Spirit Drinks. NATIONAL PERSPECTIVES Gonzalo Casanova Ferro Argentina, Land of Wines 429 1. Historic Context; 2. Actors and Protagonists;

CONTENTS 17 3. A Difficult Legal Framework; 4. An Opportunity for Tourism. Ricardo Poccioni Professional Organisation of Argentine Viticulture 439 I. Introduction; II. Legal Regulations: Objective Constraints; III. Cyclic Crisis and Ideological Perspectives; IV. The Fundamental Consensus; V. Conflict of Interests, Object of Coordination; VI. COVIAR (Argentine Wine Corporation); VI.1. Public Non-State Entity; VI.2. Purpose and Objectives; VI.3. Entity of Administration and Government; VI.4. Financial Resources – Penalties for Non-Compliance; VI.5. Executive Entities and Methodology; VII. Corollary. Sandra Sofía Arcos Valcárcel Wine Tourism in Argentina 455 I. Rural Tourism as a Development Phenomenon; II. Enotourism; III. Geographical Environment; IV. Enotourism in Argentina; V. The Post-Pandemic Era: What Can Be Expected from the Wine Tourism?. Freddy Andrés Hung Gil Analysis for a Legal Profile of the Import, Production and Marketing of Wines in Cuba 465 1. Brief Historical Review of Wine Imports and Consumption in Cuba; 2. Wine Production in Cuba?; 3. Import and Marketing of Wines in Cuba: The International Wine Festival of Havana; 4. Foreign Investment: Legislative Background.

18 WINE LAW Michael Tanti-Dougall The Wine Industry Regulation in Malta – A Legal Perspective 479 1. Introduction; 2. Grape Varieties in Maltese Islands; 3. Legislative Framework; 3.1. The Wine Act; 3.2. Legal Notice No. 167 of 2007, “IĠT Wines Production Protocols Regulations”; 3.3. Legal Notice No. 416 of 2007, “DOK Wines Production Protocols Regulations”. Carlos Armas Morales 487 The Promotion of Wine and Taxation: Urgent Harmonisation for the Growth of the Peruvian Wine Industry 1. Introduction; 2. Wine as a Consumer Good Regulated by Law; 3. Laws for the Promotion of the Wine Industry; 4. Wine and Taxation; 5. Conclusions; 6. Final Notes; 7. References. Ilie Dumitru The Evolution of Romania’s Vine and Wine Law 505 I. The Evolution of Vineyards and Wine among Romanians; I.1. Ancient Period; I.2. Medieval Period; I.3. Modern Period; I.4. Contemporary Period; II. Wine Regions and Vineyards; II.1. The Main Wine Regions and Vineyards in Romania; II.2. The Main Wine Regions and Vineyards in the Republic of Moldova; III. The Normative Framework Applicable to Viticulture; III.1. European Union Legislation; III.2. National Legislation; III.2.1. Cultivation areas and production potential;

CONTENTS 19 III.2.2. Vineyard exploitation file; III.2.3. Vine plantations; IV. National Regulatory Framework applicable to Wine Production and Marketing; IV.1. Definition of Wine and Other Wine Products; IV.2. Classifications of Wine; IV.2.1. Sugar content; IV.2.2. Quality and origin; IV.2.3. Other classifications; IV.3. Protection by Controlled Designation of Origin and Geographical Indication; IV.3.1. Attestation and control of grapes and wines; IV.3.2. Transport of wine products and mandatory records; IV.3.3. Packaging, labelling and marketing of wines. Nancho Nanchev The 2019 Russian Law on Viticulture and Winemaking 527 1. Introduction; 2. The Course of the Legislative Process Related to the New Federal Law on Viticulture and Winemaking; 3. Distinctive Features of the Federal Law on Viticulture and Winemaking; 4. Conclusion. Julio Facal Uruguay and Wine: Current Situation and Legal Framework 545 1. Background: Wine in Uruguay; 2. National Wine Institute (INAVI); 2.1. Powers and Duties; 3. Wine and Alcohol Level Legislation; 4. Conclusions. Claudia Madrid Martínez Brief Notes on Venezuelan Wine Law 553 Introduction; I. Wine in Venezuela; II. The First Regulations: Tariffs and Taxes;

20 WINE LAW III. Wine in the World of Trademark Law; IV. Wine Consumer Protection; A Short Conclusion.

ine offers a window into different territories, their traditions and their people. For this reason, wine tourism is being increasingly embraced by destinations around the world as a means to attract visitors and so support rural communities and preserve and celebrate their unique heritage. Just like the tourism sector as a whole, the wine industry is broad and incredibly diverse, encompassing established leaders and emerging regions. It includes not just the producers but also importers and exporters, as well as consumers. Moreover, all stakeholders benefit from clear, consistent rules and regulations designed to protect health, livelihoods and cultural authenticity. Through robust, continuously reviewed and updated wine law, we can ensure the responsible management of natural resources hand-in-hand with the sustainable development of rural communities. The following publication offers a comprehensive overview of recent and ongoing developments in the complex but fascinating field of wine law. Launched to coincide with the 5th UNWTO Global Conference on Wine Tourism, held in Alentejo in Portugal, it brings together leading experts from every global region. Alongside identifying common challenges facing the wider industry, including the legal protection of trademarks, as well as consumer protection and the ever-evolving field of marketing and promotion, it also showcases a range of national perspectives and significant insights into wine tourism. In my role as Secretary-General of the World Tourism Organization, I have seen first-hand the many social and economic benefits that come with thriving oenoculture, from the creation of jobs to the keeping alive of centuries-old traditions. I warmly welcome this valuable addition to our knowledge and understanding of wine law and thank all the authors for their expert insights. W

I hope this publication will serve as a trusted resource for everyone involved in the industry. I am also confident that it will both provide guidance for stakeholders in both established wine-growing regions and destinations, as well as inspiration for those destinations and communities wishing to tap into the potential of wine as a driver of growth and opportunity. ZURAB POLOLIKASHVILI Secretary-General, World Tourism Organization (UNWTO)

astronomy plays a very important role in Tourism, anytime we talk about Portuguese gastronomy, the high quality of the wine produced in Portugal is always referred to. The legislation connected with this activity is something that needs special attention in all countries where Tourism and Gastronomy are considered key activities. Tourists and suppliers must know what to expect when, buying, selling, or managing. As President of ESHTE – Estoril Higher Institute for Tourism and Hotel Studies – I am pleased to participate in the first volume of Wine Law, an endeavor of ESHTE, Salamanca, and Sorbonne. Three Higher Education Institutions from Portugal, Spain, and France among the leading tertiary educational institutes in their respective areas of teaching. Thank you all, who have contributed to this volume, the authors, from many countries and not only from Europe who shared their precious knowledge and information with us and all the ones who worked in the back-office to make this work come true. This first volume will be dedicated to our colleague João Leitão, former Vicepresident of ESHTE and former President of the Portuguese Tour Guides Association whose work was for many years, and still is, very important in the promotion of Tourism and Gastronomy in Portugal. RAÚL DAS ROUCAS FILIPE ESHTE President G

s Rector of the University of Salamanca, it is an honour to co-present this monograph on Wine Law, promoted by Professor Carlos Torres of Estoril Higher Institute for Tourism and Hotel Studies (ESHTE), with the support of the University of Salamanca, through Professor Javier Melgosa, and the University of Sorbonne, through Professor Laurence Jégouzo. Three countries that, without a doubt, have a long tradition of winemaking and are among the world's leading wine producers. In 2020, the International Organisation of Vine and Wine (OIV) estimated the global vineyard area at 7.4 million hectares, the world production of wine at around 260 million hectolitres and the world consumption at 244 hectolitres. OIV’s study also highlights the importance of the export market, both in terms of volume and value (31.8 billion euros). Concerning Spain, the 2019 study “10 años de evolución del vino en el mundo y en España” (10 years of wine’s evolution in the world and in Spain) carried out by the Spanish Wine Mark Observatory (OeMv), states that the country has become, in the last 10 years, the world’s largest exporter of wine by volume, registering a 50% growth in that period. Spanish wines are mainly destined for the European Union, accounting for 78% of the total volume and 63% of the turnover of wines sold outside Spain. In short, wine is a product with great economic weight and the source of many jobs, which requires a legal analysis of a multitude of rules that affect vineyard authorisations, grape production, processing, safety, promotion, transport, marking and so on. In Spain, the Wine and Alcohol Statue was regulated by Decree of 8 September 1932 and, in 1993, it was amended by Law of 26 May 1993, raising it to legal status. Subsequently, Law 25/1970, of 2 December, regulated the Statute of the Vine, Wine and Alcohols, which remained in force until the approval of Law 24/2003, of 10 July 2003, on the Vine and Wine. Nowadays, in addition to the vast amount of State legislation on vine quality, food safety, designations of origin, organic farming, wine production and distribution, hygiene, packaging, labelling, marketing and promotion measures, there are also the laws of the Autonomous Communities on the organisation of the wine A

sector (Canary Islands, Catalonia, Castile and Leon, Valencia, La Rioja, Navarre and the Basque Country) on designations of origin and cooperatives. Conversely, Spain’s integration into the European Union meant accepting the Community acquis and recognising the supremacy of its rules over the internal legal order. Unlike other products included in the framework of the Common Agricultural Policy, which from the beginning had a Common Market Organisation, the CMO for wine did not emerge in Europe of the Inner Six until 1970, and, until relatively recently, it has been governed by Council Regulation (EEC) No 822/87 of 16 March 1987. Since then, a large number of EU implementing and enforcement provisions have been issued, some of which are currently in force:  Regulation (EU) No 1308/2013 of the European Parliament and of the Council of 17 December 2013 establishing a common organisation of the markets in agricultural products;  Regulation (EU) No 1306/2013 of the European Parliament and of the Council of 17 December 2013 on the financing, management and monitoring of the common agricultural policy;  Commission Delegated Regulation (EU) 2019/33 of 17 October 2018 as regards applications for protection of designations of origin, geographical indications and traditional terms in the wine sector, the objection procedure, restrictions of use, amendments to product specifications, cancellation of protection, and labelling and presentation;  Commission Delegated Regulation (EU) 2018/273 of 11 December 2017 as regards the scheme of authorisations for vine plantings, the vineyard register, accompanying documents and certification, the inward and outward register, compulsory declarations, notifications and publication of notified information;  Commission Delegated Regulation (EU) 2016/1149 of 15 April 2016 as regards the national support programmes in the wine sector;  Commission Implementing Regulation (EU) 2019/935 of 16 April 2019 as regards analysis methods for determining the physical, chemical and organoleptic characteristics of grapevine products and notifications of Member States decisions concerning increases in natural alcoholic strength; and  Commission Implementing Regulation (EU) 2019/34 of 17 October 2018 laying down rules for the application of Regulation (EU) No 1308/2013 as regards applications for protection of designations of origin,

geographical indications and traditional terms in the wine sector, the objection procedure, amendments to product specifications, the register of protected names, cancellation of protection and use of symbols. We are, therefore, in a proper “jungle” of laws, regulations and other legal figures, at the international, EU, national and regional levels, which require a multidisciplinary and multinational treatment, as is done in this book. Looking at the table of contents, it can be seen that essential topics are covered, for instance, designations of origin, brand names, labelling and packaging, advertising, consumer protection and marketing. The inclusion of chapters with references to national legal systems, apart from those of European Union countries, such as Argentina, Cuba, Peru, Russia and Venezuela, also seems to me to be a good thing. I hope that this collaboration between the academic institutions of Spain, France and Portugal will serve to further strengthen our ties of friendship with the academic institutions of all countries. RICARDO RIVERO ORTEGA Rector of the University of Salamanca

s a Vice Dean of the Law School of the University of Paris I, Pantheón Sorbonne, it is an honour to co-present the first Volume of Wine Law, a loose-leaf edition that will easily allow updates in the printed format and will also be available online. Not a year after the publication of the book Collective Commentary about the New Package Travel Directive, it is a great satisfaction that Sorbonne, Salamanca and ESHTE present another initiative in such a short period. This is, in fact, a publication under the aegis of three universities in countries where wine plays a major role in their respective economies. Indeed, France has assumed a decisive role in the Droit du Vin and de la Vigne. Its vineyards are the ultimate expression of quality, where the unique terroir is strongly linked to the sustainability of the territory. It is a set of legal norms, indispensable for the evolution of a powerful sector of the economy, with a strong tradition at the national level, but where competition is increasingly greater worldwide. Hence, the publication, already in this first volume, is not confined to Europe and brings together various contributions from the South American continent. LAURENCE JÉGOUZO Vice Dean of the Sorbonne Law School A

product of Nature that unites us – 600 cities and regions –, and a single strategy to enhance the territory and the wine sector! As President of RECEVIN - European Network of Wine Cities, it is an honour to co-present the first Volume of Wine Law, a work by the Estoril Higher Institute for Tourism and Hotel Studies and the Universities of Salamanca and Sorbonne. The work carried out by these three major institutions is reflected in the pages of this book, which, through the sharing of scientific knowledge, contribute to a structuring theme for the sustainable development of territories, thus demonstrating that success lies in the collaborative work between different institutions and nations. With collaborative work as a structuring pillar of its performance, RECEVIN defends that the union and strength of the European Cities of Wine are a fundamental institutional tool for defending the interests of European local administrations, economically linked to the wine sector and wine tourism. RECEVIN has the support of National Associations and Associates from countries such as Germany, Austria, Bulgaria, Slovenia, Spain, France, Greece, Hungary, Italy, Portugal and Serbia, which translate the strength of nearly 600 cities across Europe. The set of legal norms presented here will be a decisive contribution to the work that RECEVIN and the different economic agents linked to the wine sector have been developing. It is RECEVIN’s strategic objective, as well, to see the capacity of this normative framework strengthened, in the sense of helping, in a decisive way, to assume the wine sector as an identity trait of the culture of wine-growing territories around the world; a genuine and sustainable identity. As President of this Network, I would like to extend my deep gratitude to Professor Carlos Torres and his entire team for their work. JOSÉ CALIXTO President of RECEVIN A

Designations of Origin within the EU: Legal Challenges Tomás Prieto Álvarez1 1. Introduction; 2. Towards a Greater Conceptual Certainty Concerning Designations of Origin; 2.1. Wine European Geographical Designations’ Peculiarity; 2.2. The Controversial Differentiation of Designations of Origin and Geographical Indications; 2.2.1. Non-wine geographical indications; 2.2.2. Wine geographical indications; 3. The Nebulous Formulation of the Legal Status and Its Public-Law Nature; 4. Preservation of the Common Market in Designations of Origin; 4.1. European and National Quality Systems for Origin-Labelled Products: Substitution or Coexistence; 4.2. Internal Distribution of Powers over Designations of Origin; 5. The Scope of Designations of Origin within the Agri-Food Sector; 5.1. Various Attempts at Regulation and the Role of Courts: Current Uncertainty in the European Union; 5.2. Scholars’ Views; 5.3. Personal Assessment; 6. Supervision of Designations: Verification of Compliance with Product Specification. 1. INTRODUCTION Undeniably, the momentum that the winemaking industry has been gaining can be confidently attributed to the setting up of the Designation of Origin (DO), with the industry having prospered almost unfailingly wherever geographical designation2 took hold. Interestingly, it was wine that initially propelled this remarkable legal status into existence in late 19th century France: the Union de Maisons de Champagne was granted sole ownership of that name for the sparkling wines grown in that region. Hence, it might be of great interest 1 Administrative Law Lecturer at Burgos University (España). 2 In terms of both size and quality, the parallel growth of the wine lake and its corresponding designations of origin is very apparent in Spain. Take, as a very telling example, the case of Ribera del Duero, a wine DO that bolstered its production, mostly in the past decades, with highly flattering figures: over a lifespan of 35 years, it has moved from seven registered wineries up to 300.

36 WINE LAW to delve into the concerns and legal challenges arising from these designations of origin. Much local produce has been inextricably associated with the place they originated from3. Accordingly, legislation – in instituting this rather distinct legal status which is the designation of origin, linking the origin of the product and its distinctive characteristics, these being, theoretically, indicative of a certain quality – is fashioning an existing reality and regulating it aiming to foster production, quality and fair competition. Arguably, it has been claimed that, in protecting names associated with local produce, we are contributing to “the shaping of the cultural identity of a nation or municipality”4. Incidentally, is Porto not a wine that has become the core element of the cultural identity of said Portuguese city? Lately, DOs have attracted increasingly keen eyes – particularly, the wine industry – as “the constellation of assorted interests”5 that revolve around this legal construct brighten up. Interestingly, designations of origin bring together farmers’ interests: those of local economies – seeing them as a catalyst of the prosperity of the region – and those of consumers – who, today, scrutinise products more diligently for quality and safety issues. These are collective interests that transcend those of individuals. Furthermore, the mounting keenness for open competition in markets and quality and health and safety issues in the food industry is prompting the seemingly incessant granting, announced by the Official Journal of the European Union, of new Protected Designations of Origin and Geographical Indications (GI) within the EU. It might be worth noting that, in the mid-1980s, the European agricultural policy changed its tact. Since those behind the drawing up of the Treaty that instituted the then European Economic Community prioritised, in its agricultural policy, “increasing agricultural productivity”, food supply came to be, at some stage, fully guaranteed (there was even some disruption caused by surplus). This led to what we could describe as the quality-oriented approach to agro-food farming, focused on health and safety, as well as quality issues. This shift 3 Consider the example of the pronouncements made by Advocate General Dámaso RUIZ-JARABO COLOMER, in his Opinion presented on 10 May 2005, in the Joined Cases C-465/02 y C-466/02, heard at the European Court of Justice, an opinion being a vital judicial/doctrinal reference concerning designations: “The first reference to a designation of origin can be found in the Bible”, he claimed, pointing out the allusion of the telling of the “cedars from Lebanon” when recounting the building of the Temple of Jerusalem. He adds other quotes from the Antiquity, from Greek and Roman authors such as Herodotus, Aristotle, Plato, Vergil or Horace. 4 ERRÁZURIZ TORTORELLI, C. (2010). “Indicaciones geográficas y denominaciones de origen. Propiedad intelectual en progreso”, Revista Chilena de Derecho, vol. 37, no. 2, p. 234. 5 BOTANA AGRA, M. J. (2001). Las denominaciones de origen [monograph], in OLIVENCIA, M., FERNÁNDEZ-NOVOA, C. & JIMÉNEZ DE PARGA, R. (eds.), JIMÉNEZ SÁNCHEZ, G. (coord.), Tratado de Derecho Mercantil (book XX, vol. 2), Marcial Pons, Madrid-Barcelona, p. 42.

DESIGNATIONS OF ORIGIN WITHIN THE EU: LEGAL CHALLENGES 37 gain ground in the overhaul of the 1992 Common Agricultural Policy. It was then that the designations of origin and geographical indications were integrated into European Law, quickly becoming the cornerstone of the quality-oriented food production in the European Union. Notwithstanding, it should be pointed out that in dealing with the legal concept of DOs, two elements appear to be at odds with each other: for one, that legal status has been garnering increasing support and standing in Europe ever since the EU began regulating it in 1992; however, its regulation has raised many concerns, casting some doubt as to the viability and establishment of these geographical designations. We will start with their legal categorisation, explaining how the designations of origin are conceptually pigeonholed from a legal perspective. In a short essay published over a decade ago, French Professor Norbert Olszak asserted that the designation of origin was “a little odd”, explaining that it resisted being fitted into our “preconceived legal moulds”. It should be noted that, although its legal status is unquestionably unique, Professor Olszak did not hesitate to reiterate that designations of origin are “highly appreciated”6. It is undeniable that their nature, legal implications and regulation differ across sectors. Note that the current Regulation (EU) No 1151/2012 of the European Parliament and of the Council of 21 November 2012 on quality systems for agricultural products and foodstuffs7 stands alongside remarkable peculiarities governing wine designations of origin, provided for by an exceptional legal framework (presently integrated in Regulation (EU) No 1308/2013 of 17 December8). Lately, other norms have been approved in other areas governed by peculiar quality systems, for instance, Regulation No 110/2008 of 15 January 2008 on the definition, description, presentation, labelling and the protection of geographical indications of spirit drinks and repealing Council Regulation (ECC) No 1576/899 and Regulation (EU) No 251/2014 of 26 February 2014 on the definition, description, presentation, labelling and the protection of geographical indications of aromatised wine products and repealing Council Regulation (EEC) No 1601/9110 were passed. The international context has added to the conceptual uncertainty of designations of origin. However, this article will not delve in the theoretical contributions made by the Paris (1883) and Madrid (1891) Conventions, the Lisbon Agreement (ALDO, 1958), the Geneva Act (2015) and the Agreement 6 OLSZAK, N. (2006). “L’appellation d’origine, un bien sublime?”, Études offertes au doyen Philippe Simler, Dalloz-Litec, París, pp. 777-788. 7 DOUE L 343, of 14 December 2012. 8 DOUE L 364, of 20 December 2013. 9 DOUE L 39, of 13 December 2008. 10 DOUE L 84, of 20 March 2014.

38 WINE LAW on Trade-Related Aspects of Intellectual Property Rights (TRIPS)11, following the Marrakech Agreement, within the GATT negotiations – a body that evolved into the World Trade Organization (WTO). In this last agreement, European GIs were deemed to free world trade. Interestingly, the reform of a 2006 EU regulation was driven substantially by international commitments. The concrete terms of the protection afforded by this legal framework are discussed on a regular basis12. Equally, the legal nature of designations of origin, traditionally viewed as a private-law notion, may pose some difficulty in getting a full grasp of it. Should we not rather view it as a public-law concept? There is yet another element, closely linked to the thoroughness of the formulation of DOs, over which full agreement has not been reached in European Law: its scope. In Spain, before this legal status was subsumed into European law, from the challenge launched at the Constitutional Court against the act passed by the regional parliament in Galicia on the protection of ornamental stones and the subsequent ruling 211/1990, it can be concluded that an issue such as the scope of these designations is not, by any means, irrelevant or immaterial as those stones were eventually found to be within its scope. We shall see how this plays out within the European legal frontiers. The aforementioned case reveals two further challenges arising out of the geographical indications for European law if we are to consider their fundamental purpose of establishing a single European market: the coexistence or replacement of the system fashioned by the European Union and those by the Member States, on the one hand, and, on the other, the threats to the Union by virtue of the devolution of powers regarding designations of origin (see the Spanish context). Lastly, for the sake of the preservation of food quality and fair competition, we should consider another substantial legal challenge, that of public oversight over products under the government’s remit. Let us discuss each of these issues separately. 11 For further detail on this and other issues, see PRIETO ÁLVAREZ, T. (2019). La denominación de origen. Análisis crítico de una institución jurídico-pública, Comares, Granada. 12 Regarding the fundamental international dimension of designations of origin, see: LUPONE, A. (2009). “Il dibattito sulle indicazione geografiche nel sistema multilaterale degli scambi: del Doha round dell’Organizzazione Mondiale del Commercio alla protezione Trips plus”, in UBERTAZZI, B. & MUÑIZ ESPADA, E. (eds.), Le indicazioni di qualità degli alimenti. Diritto internazionale ed europeo, Giuffrè Editore, Milán, p. 36; and, in the same work, COSCIA, G. “Il rapport fra sistema internazionali e comunitari sulla protezione delle indicazioni di qualità”, p. 43.

DESIGNATIONS OF ORIGIN WITHIN THE EU: LEGAL CHALLENGES 39 2. TOWARDS A GREATER CONCEPTUAL CERTAINTY CONCERNING DESIGNATIONS OF ORIGIN It is common knowledge that European law lays down two tiers of protection, that is, two geographical designations: (protected) designations of origin and (protected) geographical indications, albeit with some dissimilarities, far from self-evident. This distinction has been criticised by some for blurring the contours of the designation of origin, against which the geographical indication would just be a watered-down version. Designations of origin are defined in article 5(1) of the current Regulation (EU) No 1151/2012 as: “a name which identifies a product: (a) originating in a specific place, region or, in exceptional cases, a country; (b) whose quality or characteristics are essentially or exclusively due to a particular geographical environment with its inherent natural and human factors; and (c) the production steps of which all take place in the defined geographical area”. This definition – which tweaked, to some extent, the original wording of the 1992 Regulation (the details of which we cannot now look into13) – shows a strict French-style formulation of the legal concept, not far removed from the one provided by the Lisbon Agreement. As this paper will solely focus on the legal challenges of the framework, two elements must be mentioned: the conceptual peculiarity of the wine designations (2.1) and the conceptual boundaries between those and the geographical indication category, whether related to wine or otherwise (2.2). 2.1. Wine European Geographical Designations’ Peculiarity In 1962, European law had instituted the concept of “quality wines produced in specified regions” (quality wines psr or QWpsr). Later, in 2008, Council Regulation (EC) No 479/2008 of 29 April regulated the new common organisation of the wine market, taking a significant step forward in the area being studied. As they veered away from the wine quality policies based on the concept behind quality wines psr and substituted their own concepts of the horizontal policy, European Union officials identified the failings of the previous approach. This significant step in the Europe-wide regulation of wine was driven by two factors14. The Commission had emphasised, two years before, the need 13 For further elaboration on the issue, see PRIETO ÁLVAREZ, T. (2019). op. cit. 14 For further explanations, see MENJUCQ, M., (2010). “La nouvelle régulation communautaire du marché vitivinicole”, in MENJUCQ, M. et al., Histoire et actualités du droit viticole. La Robe et le Vin, Féret, Burdeos, p. 41.

40 WINE LAW for a substantial review of the legal framework on wine quality15, so as to strengthen the compliance of the quality approach with international law. It also aimed to make sure that this new approach was “in line with the horizontal policy of quality”, based on PDOs and on PGIs. In short, the desire to extend the CAP mechanisms to the wine sector prevailed, abandoning the concept of QWpsr, and shaping a system based on designations of origin and geographical indications, as well as the respect for traditional designations. However, the concepts of wine DOs and GIs that both the 2008 and 2013 Regulations integrated differ from those established by the horizontal quality system, leading to a specific oversight system for wine running parallel, instead of it being subsumed into the general system laid down for all other farm products, as suggested by some scholars16. This would have appeared to be the sensible option if real cohesion and strength were to be provided to the system, albeit bringing in some specific elements for the wine sector. As that did not happen, countless duplicities in both Regulations sprang up. This duplicity in both systems and norms will have to be attributed to the widespread view in Europe that the designation of origin for wine is a much more sensible decision that in any other sector, which might prompt the diverse conceptualisation of the concepts under oversight. As such, article 93(1)(a) of the 2013 Regulation – effectively using the same wording as the 2008 one – defines designation of origin as: “the name of a region, a specific place or, in exceptional and duly justifiable cases, a country used to describe a product referred to in Article 92(1) fulfilling the following requirements: (i) the quality and characteristics of the product are essentially or exclusively due to a particular geographical environment with its inherent natural and human factors; (ii) the grapes from which the product is produced come exclusively from that geographical area; (iii) the production takes place in that geographical area; and (iv) the product is obtained from vine varieties belonging to Vitis vinifera”. 15 See COM (2006) 319 final: Communication to the Council and the European Parliament - Towards a sustainable European wine sector, 22 June 2006 (paragraph 6.3.4). 16 According to CORTÉS MARTÍN, J. M., (2003). La protección de las indicaciones geográficas en el comercio internacional e intracomunitario, Ministerio de Agricultura, Pesca y Alimentación, Madrid, p. 338, before the 2006 Regulation and the reform of the Common market organisation of the wine sector, that “de lege ferenda we believe we should contemplate a full-scale restructuring of the common protection system of geographical indications, including the wine and spirit drinks sectors pursuant to Regulation (EU) No 2081/92. Bringing the recognition and protection of geographical indications fully under EU’s oversight would give rise to a more pragmatic all-inclusive approach, strengthening the Union’s position in the multilateral negotiations at WTO”.

DESIGNATIONS OF ORIGIN WITHIN THE EU: LEGAL CHALLENGES 41 Regarding the horizontal Regulation, it is possible to identify several dissimilarities in this definition of the designation of origin for wine, most of which boiling down to shades of meaning: 1) the system seeks to focus, in terms of its scope, specifically on wine (including varieties such as liquor sparkling and others), which is the core difference; 2) the wording of 2013 brings in, unlike those of 2008 and the horizontal Regulation, the fact that a designation of origin being the name of a country should be duly justified. In effect, we should understand that any exception, whatever the case might be, should be justified; 3) the grapes having to be grown in the geographical area – which does not make it stand out from the rest of the DOs – is coupled with the protection being confined to a specific vine variety as a guarantee of quality; 4) the connection between quality and the environment is vigorously and more sharply drawn, however, they appear to resist calibration: it appeals to its “quality and characteristics” as opposed to the “quality or characteristics” in Regulation No 1151/2012; this, it would appear, seeks to impose an unspecific requirement of “quality”, steering away from specific – and maybe more dispassionate – “characteristics” of the product; 5) these quality and characteristics are to be attributed “essentially or exclusively” due to the environment, rather than “fundamentally or exclusively”: the contrast between “essential” and “fundamental” may suggest a greater reliance on the environment of the former; and 6) the new Regulation makes use of “particular geographical environment” as a determining factor of quality and characteristics, instead of “geographical location” as used in the 2012 Regulation. This should be understood as an interest in placing greater emphasis on human intervention in wine production. It is then appropriate to assess the peculiarities identified in Regulation No 1308/2013 for wine designations against general regulations. They seem to do a disservice in bringing in nuances of very little relevance for the winemaking industry. It could well have limited itself to referencing the notion established by the 2012 Regulation – which would then become a truly horizontal regulation – simply alluding to the relevant peculiarities that might be confined to the

42 WINE LAW requirement of the usable first foodstuff17. Moreover, it might be worth insisting that the Commission calls for consistency in the quality system, whatever the scope. The set up of peculiarities for wine geographical designations might be necessary at some stage, but it will certainly not require separate regulation. 2.2. The Controversial Differentiation of Designations of Origin and Geographical Indications Attention should be drawn to the boundaries between designations of origin and geographical indications, as they have always been regulated in the same documents, since the original 1992 text, apparently without articulating relevant dissimilarities in their definitions18. This has led some scholars to raise doubts as to whether these two concepts should be kept as distinct19, bearing in mind that the legal framework is fundamentally the same for both. It should be noted that Strasburg Professor Laure Marino – an expert in intellectual and industrial property – does not view the geographical indication instituted in European law as a properly separate category from the designation of origin, but rather as a qualified version thereof. Marino would then posit an umbrella category of “geographical designations”, within which there would be “designations of origin” and “geographical indications”, which, in turn, would split into “basic geographical indications” (studied above) and “protected geographical indications” (the category we are now studying)20. Whether or not we agree with this taxonomy, it can be accepted that, while designations of origin reveal an undeniably specific nature, which would justify separate studies, the same cannot be said so categorically of geographical indications. Let us try and draw their limits within European law, starting by differentiating wine and non-wine geographical indications. 17 Even this may not be necessary. The norms concerning the allowed vine varieties come into the Regulation further into it. Both the current one (art. 83) and previous ones impose the Vitis variety for all wines, and the 1999 iteration mentioned the Vitis vinífera as the only variety apt for QWpsr. 18 In one of the first studies of the 1992 Regulation by renowned scholars, Luigi Costato remarked that “both definitions were fundamentally the same”. COSTATO, L. (1995). “La protezione delle indicazioni geografiche e delle denominazioni d’origine e le attestazioni di specificità”, Rivista di Diritto Agrario, 4, p. 492 (the author warns that the study was finished in 1992). 19 Oliveira Ascensão, a Portuguese Civil Law expert, claims bluntly that this binary concept is a “fallacious introduction”. OLIVEIRA ASCENSÃO, J. (2005). “Questões problemáticas em sede de indicações geográficas e denominações de origem”, Revista da Faculdade de Direito da Universidade de Lisboa, book XLXV, no. 1, p. 262. 20 MARINO, L. (2013). Droit de la propriété industrielle, 8th ed., Dalloz, París, pp. 124-127.