THE “INDIRECT” OR “CONCEPTUAL” EVOCATION OF A PROTECTED DESIGNATION OF ORIGIN AND ITS PRACTICAL AND JURIDICAL effect AFTER ECJ CASE QUESO MANCHEGO

I. INTRODUCTION[Up]

The judgment of the EU Court of Justice dated 2 May, 2019 on the protection of the denomination Queso Manchego^‍‍[2] is the final step in a long process of EU case-law which, starting with the well-known Cambozola case^‍‍[3], has defined, over the last 20 years, the limits of the protection of geographical indications of quality foodstuffs in the European Union through the concept of “evocation”.

From a juridical point of view, the ruling on the Queso Manchego case is particularly relevant for the clarity of its contents — which bring together the most relevant positions of the Court on this issue — and for the systematic reconstruction of the reference standards. At the same time, the expansion of the notion of “evocation” leaves unresolved the question of the balance between competition and the protection of the public interests underlying the standard (in particular consumer protection and the development of the Common Agricultural Policy) in the ambit of the European protection of geographical designations.

It is, therefore, definitely interesting to summarise the contents of the Court’s ruling in order to evaluate its consequences in terms of legal and commercial relations between PDO and PGI products and similar generic products.

II. THE DISPUTE IN THE MAIN PROCEEDINGS[Up]

The dispute which resulted in a preliminary ruling on the matter arose from an action brought by the Fundacion Consejo Regulador de la Denominacion de Origen Protegida Queso Manchego to ascertain that the company Industrial Quesera Cuquerella SL, with a production facility in the Spanish region of Castilla-La Mancha, was not entitled, in the labelling, presentation and advertising of its dairy products, to use various indirect conceptual references to the geographical indication “Manchego/La Mancha” protected in the European Union as a PDO in the “cheese” category.

In particular, the use of terms and figures from the well-known literary work Don Quijote de la Mancha was disputed (such as, for example, the name Rocinante, the use of archaic terms like “adorga” and other references from Cervantes’s novel^‍‍[4], including landscapes with windmills and sheep in the background of the labels, clearly related to the places where the novel was set).

The Fundacion’s claims were rejected both by the local Tribunal and the Court of Appeal on the grounds that the symbols and names in question were not sufficiently similar, under a phonetic and visual point of view, to the toponym Queso Manchego or La Mancha.

The local Courts stated, also, that the geographical references at issue could have been associated just to the well-known region of Spain where the producer was based, and not necessarily to the typical cheese product protected by the European Union.

The Foundation (Consejo Regulador), therefore, brought an appeal action before the Tribunal Supremo, asking, inter alia, for protection granted by the “evocation” rule pursuant to EU Regulation 510/06 on PDOs-IGPs^‍‍[5] (applicable to the ratione temporis event, today EU Reg. 1151/2012^‍‍[6]), also in the case of the registered toponym not being used explicitly to designate a generic product.

The result was the formulation of three preliminary questions to the Court of Justice of the European Union on the extension of the concept of “evocation” and on the characteristics of the average consumer to be considered when assessing the possible evocative nature of the labels in question.

III. THE NOTION OF “EVOCATION” IN THE CASE-LAW OF THE EUROPEAN COURT OF JUSTICE AND IN THE QUESO MANCHEGO CASE [Up]

The first two preliminary questions can be considered together, since both of them essentially concern the scope of the legal institution under discussion.

As is well known, the European regulations on quality foodstuffs^‍‍[7] provide registered toponyms with protection against their direct or indirect use by non-legitimate entities, or against the usurpation, imitation or evocation of the geographical indication in question (even if the true origin is specified or the label contains an expression such as “type”, “method”, “in the manner”, etc.).

The rules under examination contain, also, a final clause against “any other practice liable to mislead the consumer as to the true origin of the product” (see, as an example, Art. 13 (2) (g) of the EU regulation 1151/2012)^‍‍[8].

With specific reference to the EU case-law related to “evocation”, it should be first of all underlined that previous judgments generally originated from cases where the trade name of the contested generic product included a part of the protected toponym^‍‍[9].

The Court’s judgments were, therefore, largely focused on the ability of these generic names to trigger in the mind of the consumer an association with the registered toponyms. Thus, for example, in the Cambozola leading case, the Court held that the ending “zola” was evocative of the name Gorgonzola PDO, basing its evaluation on the “phonetic” similarity and supporting its opinion also with some reinforcing elements, such as, for example, the morphology of the product, the blue-veined nature of the cheese and other factors (used, however, in a complementary way and not as an essential part of the judgment on the phonetic evaluations).

The uniformity of following judgments on the issue appeared to require the presence, at least in part, of elements of the protected geographical indication in the trademark or name of the generic product in order to have an “evocation” from the juridical point of view.

This interpretation of the rule was also favoured by the structure of the rule (Art. 13 Reg. 510/06 and ff. mod.) where “evocation” is positioned alongside the other formal infringements of the protected geographical indications (such as imitation, misuse etc.), while a specific prohibition of misleading practices regarding the true origin of the product and its authenticity is contained only in the last comma of the rule in question.

In other words, it seemed that the aping of a protected geographical name was not covered by “evocation”, rather being related to the provision of misleading practices contained in the closing paragraph of the EU rule under examination (which implies a concrete risk of confusion), or, more in general, to the rules on unfair competition, content in the general regulation on food information to consumers (see Reg. 1169/2011/EU), and, in particular, in its Art. 7 dedicated — inter alia — to the parasitic exploitation of reputation of well-known products in competition^‍‍[10].

In 2018, the Court made a first fundamental change to the issue by introducing into the evocation paradigm elements other than the pre-eminent semantic assessment of conflicting terms^‍‍[11].

The case referred for a preliminary ruling concerned the marketing of a whisky called Glen Buchenbach, made in Germany, the label of which did not show any express reference — not even partial — to the name Scotch Whisky, protected at EU level.

However, the Scotch Whisky Association, which is responsible for protecting the PDO by law, took the view that the term “glen” (used in the Scottish language instead of the term “valley”) was sufficiently allusive to the origin of the product to trigger a mental link between the protected PDO and the generic product in question^‍‍[12].

The dispute before the Scottish court resulted in a series of questions to the EU Court for a preliminary ruling, essentially aimed at distinguishing between the concept of “indirect use” of the registered toponym and the notion of “evocation”.

The Court, upholding the innovative approach of the Advocate General^‍‍[13], stated that, although the partial integration of a toponym registered in the disputed mark represents the most recurrent case of evocation, it is not an essential precondition for an evocation under the EU Regulations on GIs protection.

According to the EU Judges, in fact, the phonetic/visual similarity between the conflicting marks is only one of the criteria which the national courts must assess in order to establish or exclude the existence of an evocation.

In fact, the decision should be taken considering the “conceptual” proximity between the figurative signs at issue in the main proceedings, taking in consideration all the relevant elements, such as the presentation, the commercial name, the use of trademarks, the image of the product, and, as a consequence, whether it can trigger a mental association to the original PDO-PGI product in the mind of an European average consumer.

In other words, the concept of evocation is not incompatible with the absence of an explicit (even partial) use of the protected name, as long as, from the actual circumstances, it is possible to derive a speculative link between the generic product and the PDO-PGI.

In the Queso Manchego judgment, here in comment, these statements are confirmed and — if possible — are even more explicit.

According to the Court, in fact, Art. 13 of EC regulation 510/06, in so far as it provides for protection against “any evocation” (even where the protected name is accompanied by expressions such as “kind”, “type”, “method”, “imitation”, etc.) does not intend limiting in any way the conduct which can be traced back to this rule, since what the standard protects is ultimately the consumer’s interest to have “clear, succinct and credible” information on the product on sale (see point 29 of the judgment) and, of course, the integrity of the PDOs-PGIs as instruments of agricultural policy for improving the income of the populations of the places of production.

A broad interpretation of the notion of evocation, therefore, makes it easier to achieve the targets of the European Legislator, thus including the prohibition of the use of images, drawings and anything else that could even conceptually trigger a mental association between products which the law aims to prevent.

The Court, therefore, confirms an interpretation of evocation which is strongly inspired by public interest, that could have a significant impact, in the future, on competition between similar-generic products and products with protected names. The purpose of protecting a fair communication for the consumer, in fact, tends to expand the sphere of evocation, and can lead to various interpretations of the rule in the future, depending on the evaluation of the judge regarding consumer behaviour.

In the same direction, the judgment also addresses the second issue relating to the freedom of communication of producers located in the same territory of the PDO-PGI.

According to the Court, in fact, the EU regulations on GIs protection do not provide for any exception authorising voluntary information in the labelling on the place of production of the generic foodstuff that can potentially conflict with the registered toponym, even if the message may be true in fact.

Such a practice would end up justifying an unfair competitive edge on the part of local producers of generic foodstuffs, since it would inevitably lead to trigger a link with the reputation of the protected geographical name on the part of local products which do not comply with the PDO scheme.

IV. THE “AVERAGE EUROPEAN CONSUMER”[Up]

In the light of the foregoing, the Court also addresses the third issue referred for preliminary ruling concerning the parameter of the “average consumer” on which the judge should base his assessment of the evocative nature of the commercial communication under examination.

The Queso Manchego judgment confirms, in this regard, first of all, the need for the national Courts to carry out their assessments taking account of the “average European consumer”, that is to say, a reasonably well-informed and attentive person who incorporates the different national sensitivities in an increasingly global and open market^‍‍[14].

In Viinverla^‍‍[15] the EU Court underlined the need to ensure uniform protection for PDOs-PGIs throughout the EU by assessing the impact of the communication message on the various markets in the EU Member States: in other words, the psychological effect of evocation should be predicted with due regard to the different degrees of consumer confidence in the typical product in the various Member States.

In the case here under examination the Court has, moreover, specified that the “uniform” nature of the protection does not exclude evocation where the risk of “mental association” between the products depends on specific national cultural sensitivities.

The protection afforded by the EU legislation in question protects both from the exception relating to the lesser sensitivity of certain peoples regarding the semantic value of certain names^‍‍[16], and the exact opposite, i.e. where generic products are parasitically attached with regard to specific local cultural traditions in order to exploit their market appeal^‍‍[17].

In this way, the task of the national judge becomes particularly delicate and complex.

In his evaluations, the judge will have to take into consideration a very wide series of factors, in order to construct a parameter of assessment that does not refer to a monolithic and abstract cosmopolitan consumer that includes in itself all the national attitudes, but a plurality of persons, with their cultural specificities and national sensitivities.

V. FINAL REMARKS[Up]

In the light of the summarized elements, it seems possible to make some remarks with regard to the juridical and practical consequences of the judgment Queso Manchego and its influence on the future case-law of the European Court of Justice related to PDO-PGI protection issues.

From the juridical point of view, the most significant result of this judgment seems to be the definitive confirmation that consumer protection is the principal key for the interpretation of the European rules on protection of geographical indications.

In fact, the Court resolves the latent conflict between freedom of competition, fundamental rights of the producers and the protection of the underlying public interests through the principle of the effet utile, taking as a priority the protection of right of consumers to a clear, succinct and credible information regarding the origin of the product.

This criterion seems to be the keystone of the juridical construction under examination and could also be the answer to further pending preliminary rulings.

In fact, the increasing protection of PDO-PGI in order to safeguard public interests can have a significant impact on the marketing relationships with regard to this specific ambit of the Single Market. It can also determine a remarkable limitation of the rights of business operators who are not part of the PDO scheme.

The question is not so much the evaluation of the fairness of suggestive advertising, where the parasitic nature of the approach makes evident the need to defend the primacy of quality product and, of course, the need for a full protection of their geographical names.

The most critical aspect is, rather, the problem of the freedom of expression of producers who are based in the same territory as a PDO-PGI, which can collide with such a strict interpretation of the rules in question.

According to the Court, in fact, the EU regulations do not provide any specific exception to the “evocation rule”, because, otherwise, this could create an unfair advantage for those producers based in that territory but who do not take part in the PDO-PGI scheme. Thus, under the radar, the Court takes for granted that the PDOs-PGIs have a sort of cultural/semantic/communicational priority (or supremacy) with regard to the territory, so that any reference to its geographical indication — even if true — should be considered in the light of evocation.

This point reveals the Court’s balancing approach to some of the most important “constitutional rights” of the EU legal order in this field: competition (upon which the internal market was built according the liberal view of the European intergration) and the new fundamental values, among which — with specific regard to the market regulation — the expectations and rights of consumers.

In fact, starting from the presumption that the registration of a PDO-PGI creates itself a risk of confusion with regard to any reference to the territory in the labelling of simil-generic products, the Court’s objective of protecting quality schemes ends up overcoming private interests at stake.

Moreover, we are not witnessing a change of priorities in the Community legal order: there are not two opposite values at stake, but, the same principle in its modern evolution.

In fact the European competition law has itself evolved adsorbing issues such as consumer protection, clarity of information and freedom of choice in the market.

If, therefore, the current competition paradigm cannot ignore the real driving force in the marketplace (namely, the final purchaser of goods and services), the “useful effect” principle should be focused on the consumer’s freedom of choice. Thus the practical application of this principle (the so-called “proportionality”) should be used by national judges in order to guarantee consistency in the application of the rules in discussion.

Therefore, the extension of the notion of “evocation” to all parasitic marketing approaches (such as “aping”, conceptual references, allusions and any other unfair practice that can influence consumer behaviour and choice) offers a better protection to PDO products and to the autonomy/freedom of the targets of commercial communication, in line with the parallel legislation and case-law^‍‍[18] on the protection of the so-called “well-known” trademarks, where protection includes the mere “risk of association” between signs/symbols/designations of the competing product and the registered industrial property right, as well as any conflictual use of the mark (trade name or trademark, as the case may be) which permits obtaining an “unfair competitive edge from the distinctive character or the reputation” of the imitated mark^‍‍[19].

By applying the same criteria (precaution in order to guarantee the best level of consumer protection) to the definition of the boundaries of the issue, the outcome will be the necessity to relate all the implementation rules to the expressed principle^‍‍[20].

Certainly, the practical implication of this approach is a significant risk of a progressive “closure” of the PDO chain, that is a strict separation of the production chains and the creation of a market sector dedicated to quality products that is increasingly detached from the competing generic products.

From the “communication” point of view this effect is aggravated by the growing unpredictability of the evocation judgment, considering that the factual elements (left to the opinion of national judges) are largely outweighing the juridical elements (such as the incorporation of a protected part of the toponym in the generic denomination/private trademark, the generic nature of the term used by the competitor etc.).

So, in the end, the progressive expansion of the notion of “evocation” should lead the producers of similar-generic products to a sort of self-discipline marketing approach, in order to limit the mental association between elements of their communication with the reputation of the protected geographical indication, and this approach — sooner or later — leads to a separation of the two markets.

While, in fact, the solution put forward by the Court does not rule out that, in the judgment on evocation, the national court may save certain elements of the labelling, presentation or advertising of the generic product, because they are true or in any event not sufficiently unambiguous to determine the mental association between products^‍‍[21], the acceptance by the assessment of heterogeneous factors such as the shape and morphology of the products, the graphics of the communication, the indirect conceptual elements etc., in the absence of the direct use of the toponym, makes advertising in this market environment particularly insidious.

For this reason national judges should approach with a great deal of caution the factual evaluation between lawful information to consumers regarding the characteristics of the products on the market and the possible breach of the conceptual limit of the indirect “parasitic exploitation” of the PDO - PGI reputation^‍‍[22].

This is also the reason why the Court urged a wider use, in the future, of the preliminary ruling instrument, according Art. 267 TFEU, in order to ensure the overall consistency of national decisions^‍‍[23], avoiding excessive fragmentation of judgments due to different national sensitivities.