The EU-NZ Free Trade Agreement (EU-NZ FTA) was signed mid-last year and came into effect on 1 May 2024. It aims to promote trading relations between New Zealand and the EU, ultimately aiming to increase New Zealand exports by up to $1.8 billion per year by 2035.
The EU-NZ FTA removes tariffs on the export of horticultural products, wine, honey and other agricultural products including dairy and red meat, and fisheries. While local producers will benefit from increased opportunities for trade, consumers will be able to purchase products from the EU much more cheaply than before.
A summary of the key outcomes of the EU-NZ FTA can be found here.
One of the big changes for New Zealand businesses in the food and beverage / grocery industry is the update to the geographical indications (GI) regime. This has been implemented via amendments to the Geographical Indications (Wines and Spirits) Registration Act 2006 (known from 1 May 2024 as the Geographical Indications Registration Act 2006) (the GI Act). The GI Act already provided for a register, adjacent to the Trade Marks Register, of GIs for New Zealand and international wines and spirits only. The amendments to the GI Act extend the scope of protection to EU GIs for other goods too.
What are geographical indicators?
GIs are signs (most commonly words) that identify a product as originating from a region or area where a quality or other characteristic of the product is attributable to that geographical origin. Perhaps the most famous GI is "Champagne", which can only be used in respect of wine produced in the Champagne region of France. All others must instead be labelled as "sparkling white wine" or "Méthode traditionnelle" (i.e. the process used to produce Champagne, if that is how they are made).
GIs are collective intellectual property rights in that, unlike trade marks, they do not belong to an individual owner or producer. Their value comes from being able to indicate to consumers that the product is authentic and has specific qualities associated with the GI. Any trader that meets the relevant requirements of the GI can use it in respect of their goods. For example, any winemaker in New Zealand can use "Central Otago" if at least 85% of the wine is made from grapes harvested within the geographic boundary shown on the register and if the rest of the wine is made from grapes harvested elsewhere in New Zealand.
In New Zealand, GIs are only registrable for wines and spirits; however, overseas GIs are protected for a range of other goods. One of the outcomes of the EU-NZ FTA is mutual protection for some existing EU and New Zealand GIs. The EU has provided a list of 1,975 GIs now protected in New Zealand (see the Annex to the EU-NZ FTAhere (Section A)). These mostly cover foods and beverages, but also include essential oils. Reciprocally, 23 New Zealand wine GIs are protected in the EU (these are also listed in the Annex (Section B)). Another outcome of the EU-NZ FTA is a process to protect additional NZ GIs in the EU (and vice versa) in the future, including, in the case of EU GIs that can be protected in NZ, for "flowers and ornamental plants" and "products of the milling industry".
EU GIs now protected in New Zealand
With effect from 1 May 2024, the EU GIs listed in the Annex are automatically protected in New Zealand. Likewise, the NZ GIs listed in the Annex are automatically protected in the EU. Practically, this means that use of the EU GIs is restricted in New Zealand, even if the packaging also indicates the product’s real place of origin, or uses qualifications like "kind" or "style". For example, the term "Bordeaux" is not able to be used in respect of wine unless it comes from the Bordeaux region in France and is made according to the rules of its production.
Of the EU GIs that are protected in New Zealand, several are terms that many New Zealand consumers would likely interpret as generic descriptors, for example "feta", "prosecco" and "port". For these, phase-out periods of between 5-9 years apply, allowing users time to adopt alternative terms. To benefit from the phase-out period, businesses must clearly indicate the true origin of the good on their packaging, for example by adding "made in New Zealand". A full list of the EU GI’s that have phase-out periods is available here.
For users of "gruyère" and "parmesan" a "prior user" exemption may be available, allowing indefinite use of these terms. For this exemption to apply, the prior user must have used the relevant term in good faith since at least 1 May 2019 and continued use of the term must be accompanied by a clear indication of the true origin of the cheese. Several cheese producers have already been identified as prior users by MFAT (see the list here).
Clarification to come
There are still several unknowns concerning how the protection of EU GIs in New Zealand will be enforced, for example:
•Whether the restrictions on use of EU GIs under the GI Act apply only in respect of the relevant product class for which they are registered, or whether use of a GI as an ingredient in another good that doesn’t fall within the relevant product class is also subject to the restrictions under the GI Act. It is possible, but not clear under the GI Act, that the restrictions only apply in relation to the relevant product class, and that other use (such as for ingredients) will be regulated under the Fair Trading Act 1986 (misleading and deceptive conduct, and unsubstantiated representations provisions).
•How images (e.g. a cube of white cheese) and soundalike names should be treated. Again, it is likely this would be managed under the Fair Trading Act 1986 rather than the GI Act.
•The status (if any) under the GI Act of MFAT’s prior user list, and whether other users not listed but who meet the requirements of the "prior user" status are able to benefit from that exemption.
We anticipate guidance on some of these matters will be provided by the relevant Ministries.
If the GIs impact your business, or you would like to know more about GIs or the EU-NZ FTA, please get in touch.
