Despite the gloomy outlook for international trade, the EU-China Agreement on Geographical Indications is expected to enter into effect by the end of 2020. On the surface, the agreement would appear to be a simple matter of economic gains for both parties. Yet, what the deal really represents is a success on Brussels’ part to export its GI policy abroad, driven by and driving increasing gastronationalism at home. It remains to be seen if and how China will take a leaf out of the EU’s book to reap the benefits of this agreement in a similar way.
Earlier this July, the European Council adopted decisions on the signature of an agreement between the European Union and the government of the People's Republic of China on Geographical Indications (GIs) – a type of intellectual property right that is supposed to safeguard local culinary traditions in a globalized market. Some well-known examples of protected “food names” from the European Union are Roquefort cheese from France, Kalamata (Elia Kalamatas) olives from Greece, Parmigiano Reggiano from Italy or Irish whiskey. If the bilateral agreement receives the European Parliament’s consent, it is expected to enter into force before the end of 2020. The agreement will ensure that 100 agri-food GIs for the EU and China respectively will be protected in the partner market. By 2024, an additional 175 GI names will be added to each side’s list, with the opportunity to add more thereafter (European Council 2020). The list of GIs currently taken up in the bilateral agreement are complimentary: whereas the EU wants to protect local wines, cheeses, spirits and hams, China aims to safeguard teas, fruits, liquors and raw agricultural goods (such as mushrooms, oranges, garlic, ginger or berries).
As the first significant bilateral trade agreement signed between the EU and China, the recent conclusion on the agreement in itself is already considered a success. Symbolizing mutual recognition, the agreement should protect the products listed from imitations and alleviate the risk of local copies. Both parties to the agreement will have to ensure compliance and monitoring, as well as legal means for protection. Regarded as a landmark in the bilateral economic relationship (and after ten years of negotiation), both partners have high expectations for the agreement: reportedly, it will contribute to revitalizing rural economies with its attention to local values, culture and tradition, and preserving food heritage. But most importantly, both sides envision significant economic benefits.
Specifically, for the European producers, China – or its giant middle class with an appetite for high-quality European food products - is a high-growth market. As it stands, the country is the second destination for EU agri-food exports and the second destination for EU GI exports, accounting for 9% of the total European GI exports.
Yet, not only the EU is eying supposedly attractive Chinese markets.
Interestingly, the Phase One Agreement – part of a broader trade deal between the US and China now arguably in deadlock - has taken up regulatory requirements on GI protection for China to comply with as well. Aimed directly at the European GIs listed in the EU-China GI Agreement, the US-China agreement states that GIs or components of GIs (such as mozzarella in Mozzarella di Bufala Campana) will not be protected in China if they have become “generic”. On top of that, the US will get the opportunity for disagreement about GIs agreed with the EU (USTR 2020, Section F). Focusing on generic GI names and prior trademarks, clearly, these provisions aim to prevent China from recognizing new European GIs that could hinder US producers from entering the Chinese market. In other words, the agreement introduces a means for the US to challenge and remove protection for the European GIs in order to increase market access to American agri-food exports that are similar.
This strategic game hints at the fundamental disagreement between the EU and the US on GIs, sometimes dubbed the “War on Terroir” (Josling 2006). The different understanding of the GI terminology by the system’s key proponent (the EU) and opponent (the US) clearly leads to tension when these products are exported to third markets.
The concept of Geographical Indications originated in and is often associated with the European Union: since 1992, EU law includes a framework for protected designation of origin. The protection it provides is double fold: it should shield the producer from unfair competition, and the consumer from misleading labelling. Beyond the Single Market, European GIs are not by definition protected in a similar fashion. GI protection has been introduced as a safeguarding measure in the global market following the TRIPS (Trade Related Aspects of Intellectual Property) Agreement in 1994. Although this WTO agreement covers wines and spirits, it offers less protection for foodstuffs. Moreover, there is no WTO consensus regarding the actual level of protection, and its implementation varies country by country. Most prominently, the EU’s sui generis system clashes with the US’ GI trademark registration. Simply put, for the EU, a GI’s given quality or reputation is essentially attributed to its geographical origin and often includes specific “traditional” production standards. In the American system, a GI is considered a trademark, which is based on distinctiveness, exclusivity, and priority. In practice, this means for example that the EU might not be able to register a GI for protection in a third market where a prior trademark on the same name is already registered. Arriving first is thus key in defining the regulatory space of a third market, specifically in one that imports a lot of agri-food products. Like China.
Given the quick strategic action by the US on this point, we can assume the economic benefits of GI recognition are substantial. However, research shows that the actual economic benefits of a GI agreement are limited and its contribution to local development are debated (Huysmans 2019; Higgins 2018; Calboli 2015). Moreover, although this US intervention reads like a strategic economic power move for the US, in practice, the actual impact would be limited to only a handful European GIs (Hu 2020).
What is at stake then, if not purely economic gains?
It is clear that neither the EU-China nor the US-China GI agreement are primarily about economics, China, or the country’s culinary heritage. This latest episode of the War on Terroir exemplifies again how the GI system is a schizophrenic regulatory game, played out primarily in third countries among competing exporting powers. The potential reward is not the economic benefit (which is debated), but rather the chance to define the actual regulatory system. Indeed, considering the heated debate and contention, the EU has been trying to spread its interpretation of GI protection through bilateral trade agreements, of which the FTA with South-Korea (effective 2015) was the first attempt. For every FTA since, the GI clause is treated as a red line, yet the actual list of products is different each time. Huysmans argues that also this process of adding or conceding products on the GI list is part of a European negotiation strategy – limiting concessions on the side of the trading partner, while appealing to the Member States’ culinary identities (2019).
Indeed, GIs are not only a marketing tool targeting global audiences. If anything, the system signals and asserts local and national identities at home. As flags of cultural identity, the increasing use of GIs reflects a rising tendency towards gastronationalism, a term coined by Michaela DeSoucey (2010) referring to the emotive link between food, identity and nation. In fact, both as a governmental practice aimed at protecting national and regional interests, and as a public discourse of belonging through food, gastronationalism in Europe is increasingly normalized (Leer 2019). National flags colour the packagings on supermarket shelves, food TV shows promote narratives of “our” culinary national identity, social media debate “true” and “false” versions of national dishes, and only last April a new EU food origin labelling law came into effect. For the individual Member States, the recognition and protection of “original” local culinary traditions towards the outside world functions as a strong assertion of national identity, appealing to cultural sensitivities.
What's in it for China then?
Over the last 15 years, this new form of identity politics through food has also been gaining momentum in Northeast Asia, with countries like Japan, Korea and Thailand championing gastronationalism and culinary diplomacy. China however is quite new to the global game and faces the reputational damage of several high-profile food scandals during the last 20 years. However, as Chinese regional cuisines and local food products, from Sichuan pepper to Pi Xian fermented bean paste, are increasingly gaining overseas popularity, its international recognition and brand value have been growing. As a country with a strong culinary heritage that is still shrouded in obscurity abroad, China has much to gain from jumping on the GI bandwagon. Undoubtedly, maintaining traditional production processes and guaranteeing high-quality produce are noble goals of the GI system. Yet, it is precisely its potential as an identity strategy to assert a specific food item as “the original” that might prove of tremendous value in Northeast-Asia. In a region where food wars mount over i.a. the origin of kimchi (China, Japan, Korea), ginseng (China, Korea) or persimmon (Japan, Korea), the GI system can easily be deployed for gastronationalist purposes. As a useful tool to differentiate one nation’s identity from a neighboring one, the system can serve towards public awareness and institutional recognition of these cultural identity markers in the international sphere.
China might not have the first-mover advantage in Europe to demarcate its culinary identity – both Korea and Japan have already signed FTAs with the EU. Yet, in a Europe where consumers are quite sensitive to the origin of their food, the recent agreement will certainly raise awareness and visibility of Chinese high-quality produce, and the GI guarantee can help alleviate (at least) food-related trust issues.
As a system of legal protection for local artisan producers in a globalized market, the GI label is without doubt a strong marketing tool. Whether the claimed economic benefits of this label under the EU-China GI agreement materialize for the European producers depends on the Chinese enforcement of the measures and whether the EU can prevent its GIs from becoming generic.
Yet, although its economic potential remains debated, the bilateral agreement’s success can already be counted in political and cultural terms: with the impact of the American move limited, the GI agreement has served its purposes for the EU as a negotiation tool, a policy export and a gastronationalist cultural identity marker – both domestically and abroad. It will be interesting to see if China can deploy the agreement to its own benefit in a similar fashion.
 According to the WIPO, a geographical indication (GI) is a sign, label or name used on products that have a specific geographical origin and possess qualities or a reputation that are due to that origin. In order to function as a GI, a sign must identify a product as originating in a given place. In addition, the qualities, characteristics or reputation of the product should be essentially due to the place of origin. Since the qualities depend on the geographical place of production, there is a clear link between the product and its original place of production (WIPO).