by Michael Fridjhon
The news that the European Union has re-allocated to Kosovo the 13m Euro payment due to South Africa in terms of a bilateral trade agreement finalised five years ago has provoked outrage in the South African wine industry. This information was tabled on the EU website in late November and comes with an explanation indicating that the budgeted amount has lapsed because the agreement in its totality has not been ratified by the South African parliament.
The wine and spirits component of the SA-EU trade agreement involved prolonged and robust negotiations. In the end both parties agreed to sever it from the main agreement and to give its terms and conditions once agreed retrospective application. The most difficult aspects of this separate accord related to intellectual property rights and to geographical indications (GI).
The EU insisted that South Africa agree to enforce its interpretation of GI status to the categories of Port and Sherry even though neither term meets the generally accepted requirements relating to GIs. Correctly a GI bears not only the method associated with its production, but also the name of the place whose characteristics give the GI its uniqueness. Champagne for example is both the name of the place where the fruit which produces Champagne is grown and the method of production, a second fermentation in the bottle in which the wine is sold.
South Africa argued that Sherry is a corruption of Jerez de la Frontera the area of origin of Spanish Sherry and that Port from the name Oporto is merely the harbour from which the fortified wine produced in the Douro Valley is shipped.
South Africa finally conceded the EU position under pressure but with the rider that the EU pays over a sum variously reported as either 13m or 15m Euros as compensation for the loss of the intellectual property rights enjoyed by South Africa´s Port and Sherry producers. This is the money which the EU has just announced it will not be paying South Africa despite the full application of the various agreements for several years.
Apparently both parties have yet to finalise their schedules of conflicting trademarks and GIs. These are issues which need to be resolved because some names such as the 200 year old South African trade mark Nederburg, one of the country´s best known Paarl-based wineries are the same or similar to GIs which enjoy protection in the EU.
The EU has announced that South Africa will be entitled to re-apply for the designated funds.
