REGULATORY SCRUTINY BOARD OPINION Proposal for a Regulation of the European Parliament and of the Council on geographical indication protection for craft and industrial products and amending Regulations (EU) 2017/1001 and (EU) 2019/1753 of the European Parliament and of the Council and Council Decision (EU) 2019/1754

EUROPEAN COMMISSION
Brussels, 17.12.2021
SEC(2022) 193 final
REGULATORY SCRUTINY BOARD OPINION
Proposal for a Regulation of the European Parliament and of the Council on
geographical indication protection for craft and industrial products and amending
Regulations (EU) 2017/1001 and (EU) 2019/1753 of the European Parliament and of the
Council and Council Decision (EU) 2019/1754
{COM(2022) 174 final}
{SWD(2022) 114 final}
{SWD(2022) 115 final}
{SWD(2022) 116 final}
Offentligt
KOM (2022) 0174 - SEK-dokument
Europaudvalget 2022
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This opinion concerns a draft impact assessment which may differ from the final version.
Commission européenne, B-1049 Bruxelles - Belgium. Office: BERL 08/010. E-mail: regulatory-scrutiny-board@ec.europa.eu
EUROPEAN COMMISSION
Regulatory Scrutiny Board
Brussels,
RSB
Opinion
Title: Impact assessment / Geographical indication protection for crafts and
industrial products
Overall opinion: POSITIVE WITH RESERVATIONS
(A) Policy context
This initiative aims to establish a harmonised or unitary geographical protection system for
craft and industrial (CI) products. Geographical indications (GIs) establish intellectual
property rights for products whose qualities are specifically linked to the area of
production. While a GI protection system already exists at the EU level for agricultural
products, such systems only exist at the national level in 16 Member States for CI
products. The absence of EU-level protection for CI products does not allow the EU to
meet its obligations under the Geneva Act administered by the World Intellectual Property
Organisation.
(B) Summary of findings
The Board notes the useful additional information provided in advance of the
meeting and commitments to make changes to the report.
However, the report still contains significant shortcomings. The Board gives a
positive opinion with reservations because it expects the DG to rectify the following
aspects:
(1) The report is not sufficiently clear about the level of discretion the EU has to
comply with its international obligations under the Geneva Act.
(2) The presentation of the options does not allow for a transparent assessment of
their costs and benefits.
(3) The choice of the preferred option and its proportionality is not justified
sufficiently.
(C) What to improve
(1) The report should clarify the degree of discretion the EU has to comply with the
Geneva Act of the Lisbon Agreement. It should better explain what constitutes ‘crafts and
Ref. Ares(2021)7820042 - 17/12/2021
2
industrial products’ and how the boundaries of application will be determined.
(2) The report should allow a more transparent assessment of the strengths and
weaknesses as well as costs and benefits of the options with a view to bring out more
clearly the available substantive policy choices. As option 5 (self-standing EU Regulation)
builds on many elements of option 3 (extending the existing GI system), the sequencing of
the options should be improved by presenting it directly after option 3 with option 4
(reform of the trade mark system) presented last. As option 5 presents a set of alternative
sub-options, the report should identify the most relevant and best performing combination
of suboptions upfront and subsequently compare them along all other options.
(3) Building on a better comparison of the options, the choice of the preferred option
should be better argued, also considering the substantial equivalence between the estimated
costs for option 3 and option 5. Taking into account that the envisaged eligible craft and
industry GIs are rather limited, the proportionality assessment of the preferred option
should be strengthened. As to option 4, the report should better assess how realistic it is to
reform trade mark law in order to include GI features.
(4) Even in the absence of empirical evidence, the potential impacts of the various options
on competition, innovation and the environment should be better analysed and explained.
(5) The report should clarify its position on the use of a mandatory or a voluntary
protected geographical indication (PGI) logo, in view of the fact that consumer awareness
of the PGI logo for agricultural products is low.
(6) The monitoring and in particular evaluation arrangements are missing in the report and
need to be clearly established.
The Board notes the estimated costs and benefits of the preferred option(s) in this
initiative, as summarised in the attached quantification tables.
Some more technical comments have been sent directly to the author DG.
(D) Conclusion
The DG may proceed with the initiative.
The DG must revise the report in accordance with the Board’s findings before
launching the interservice consultation.
If there are any changes in the choice or design of the preferred option in the final
version of the report, the DG may need to further adjust the attached quantification
tables to reflect this.
Full title Proposal of a regulation of the European Parliament and of the
Council concerning geographical protection for craft and
industrial products
Reference number PLAN/2020/9272
Submitted to RSB on 19 November 2021
Date of RSB meeting 15 December 2021
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ANNEX: Quantification tables extracted from the draft impact assessment report
The following tables contain information on the costs and benefits of the initiative on
which the Board has given its opinion, as presented above.
If the draft report has been revised in line with the Board’s recommendations, the content
of these tables may be different from those in the final version of the impact assessment
report, as published by the Commission.
I. Overview of Benefits (total for all provisions) – Preferred Option
Description Amount Comments
Direct benefits
Economic benefits
In the longer term, it could lead to
economic development of GI region
and yield an overall expected increase
in intra-EU trade of these goods of
about 4.9-6.6 % of current intra-EU
exports (€ 37.6-50 billion).1
In the case of Solingen producers
estimate that the use of the name
Solingen raises the willingness to pay
by about 30 percent 2
Help producers seize
opportunities to develop
and commercialize CI
products.
Raise the willingness to
pay of the consumers
Social benefits
The analysis shows a potential
increase of regional level employment
by 0.12-0.14 %. Overall, this move
would help create between 284 000
and 338 000 new jobs across the EU3
.
Positive effect on
employment4
Consumer benefits
e.g. producers of Perpignan Garnet
Jewellery mentioned that demand has
increased by 20-30 percent, since the
recognition under the French GI
regime5
Enhanced visibility on
authenticity and quality
of products
Indirect benefits
Environmental benefits GI protection is a way to
increase economic
sustainability to the
2
2020 Study p.82
3
The analysis shows a potential increase of regional level employment by 0.12-0.14 %. Overall, this move
would help create between 284 000 and 338 000 new jobs across the EU Geographical indications for non-
agricultural products, Cost of non-Europe report (2019)
https://www.europarl.europa.eu/thinktank/en/document.html?reference=EPRS_STU(2019)631764 pp. II, 24-
27
4
ibidem
5
VVA et al (2020), supra note, p. 81
4
benefit of all
stakeholders6
Tourism benefits Potential reputational
effects for the region:
raise the visibility of the
product and the region,
benefiting also the related
industries such as
tourism.7
Cultural heritage Help save products that
have a long history
behind them like Swiss
watches, or Baluchari
saree.8
6
2021 Study on Monitoring and enforcement rules for geographical indication (GI) protection for non-
agricultural products in the EU, p.137 and 167; and in the agricultural area, some MS authorities use the
specific GI protection as a tool to encourage sustainable development (Evaluation support study on
Geographical Indications and Traditional Specialities Guaranteed protected in the EU p.246-247)
7
VVA et al (2020), supra note,, p. 81
8
VVA et al (2020), supra note, Annex 1: Case study
6: GI and trade mark protection in non-EU countries
pp.7-9
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II. Overview of costs (in million EURO)*– Preferred option
Stakeholders
Action
Consumers Producers of GI
products
MS Authorities Commission/
EU body
(EUIPO)
One-off Recurrent One-off Recurre
nt
One-off Recurrent One-off Recurre
nt
(a) Setting
up a CI GI
protection
system
Direct
costs
Time for
staff to
acquire
new
procedures
9
Cost to
implement
the MS
Scrutiny
procedure
10
.Time for
staff to
acquire
new
procedures
.2 years is
estimated
to
implement
the IT
system for
CI GIs
application
files11
(b) administration and monitoring of the CI GI protection system: annual cost per GI
(EUR)
Registration Direct
costs
15,000 1,800
Verification Direct
costs
5,700 100
Management
/ monitoring /
enforcement
Direct
costs
3,000 3,900
9
See Annex 9 p.143
10
See Annex 9 p.144
11
See Annex 9 p.138
Electronically signed on 17/12/2021 11:11 (UTC+01) in accordance with article 11 of Commission Decision C(2020) 4482