1 Introduction
The concept of a geographical indication (GI) as a badge of origin that performs the function of identifying the geographical source of a product and its unique characteristics or quality that results from its geographical origin is a fairly recent development in the landscape of Malaysian intellectual property law. GIs were only formally recognised in Malaysia as a distinct type of intellectual property right when the Geographical Indications Act 2000 (GIA 2000)Footnote 1 was enacted. The Act, which came into force on 15 August 2001, was Malaysia’s response to its international obligations to protect GIs under the Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS Agreement).Footnote 2 At that time, there was relatively little understanding of the benefits and potential impact of a system of protection of GIs on the socio-economic development of the country, particularly with regard to sustainable rural development. Even though there is currently no specific study that has been conducted in Malaysia on the impact of GI protection on the country’s socio-economic development, it is safe to say that at the present moment there is a general perception among stakeholders of intellectual property rights that GIs have a potentially positive impact on the generation of income, creation of local employment and, implicitly, the country’s social and economic development.Footnote 3 This is because consumers often place value on products that they associate with a certain geographical origin and GIs are potentially effective marketing tools of great economic value.Footnote 4 GIs are able to link products to their geographical regions, which oftentimes are in rural areas, and connect consumers to the producers.
As GIs were not perceived as a distinct form of intellectual property prior to the GIA 2000, it is not surprising that no applications were made to the Intellectual Property Corporation of Malaysia for the registration of geographical indications until the year 2003. Even then, there was only one application for registration made in that year.Footnote 5 The number soon escalated, and in the year 2015 alone there were thirty-one new applications filed to register GIs in Malaysia.Footnote 6 Of these, twenty-nine applications were by Malaysian applicants while two were by foreigners. Needless to say, not all applications were successful because they lacked the necessary requirements, but it suffices to note that by the end of 2015 there were in total fifty-nine registered GIs on the Register of Geographical Indications set up under the Act.Footnote 7 These registered GIs belong primarily to products related to agriculture-intensive industries as well as to producers in the handicraft and food sectors, which possess historical and cultural links between the geographical area of the GI-denominated products and the respective groups of producers.Footnote 8 For example, in the agriculture industry, producers of pepper, tea, coffee, rice, ginger, mangoes, groundnuts and durians have obtained registration of their GIs under the Act.Footnote 9 Producers of handicrafts such as songket (a handwoven fabric), batik and wood-carving have also registered their GIs for protection.Footnote 10 Similarly, GIs have been registered by producers of food items such as belacan (shrimp paste), cheese and biscuits.Footnote 11 The increase in the number of applications for registration of GIs over the relatively short span of time suggests that producers are aware of the importance of adequate legal protection of GIs in contributing to the commercial success of their products.
Starting from the premise that GIs play an important role as a tool in marketing strategies to advance the commercial and economic interests of GI producers,Footnote 12 this chapter discusses whether the current legal protection of GIs in Malaysia is adequate to prevent third parties from free-riding on the reputation of a GI. Adequate legal protection is necessary to prevent the unauthorised use of a GI by a third party for the purpose of misleading or confusing the public as to the geographical origin of a product, particularly when the product does not comply with the specific conditions of manufacture or does not originate from the geographical area. Apart from that, widespread unauthorised use of a GI could eventually result in the GI becoming a generic term. The unauthorised use of a GI in trade is detrimental to the legitimate interests of consumers and producers and, ultimately, will negatively impact the economic success of the industry that markets its products using the GI. In particular, the first part of the chapter provides an overview of the importance of GIs in the marketplace and describes two scenarios, both at a supranational level involving Malaysia, where GIs were at issue. The second part of the chapter discusses the scope of protection conferred on GIs pursuant to the GIA 2000 and the extent to which the Act promotes the use of GIs in trade. This is then followed by a discussion of the role played by the law of passing off in protecting GIs, particularly prior to the enactment of the GIA 2000. Subsequently, the provisions of the Trade Marks Act 1976 (TMA 1976),Footnote 13 the Consumer Protection Act 1999 (CPA 1999)Footnote 14 and the Trade Descriptions Act 2011 (TDA 2011)Footnote 15 that are relevant to the protection of GIs are briefly mentioned. Finally, the chapter analyses whether the current regime for protection of GIs in Malaysia creates a suitable legal environment that enables holders of GIs to prevent their unauthorised use by third parties in the marketplace.
2 Geographical Indications as an Important Tool in Trade
The notion of a GI hinges on the link that exists between the product, its geographical origin and its quality or other unique characteristics that are attributed to the geographical source. The particular quality, trait or unique characteristics result from natural geographic advantages such as climate, soil, raw materials, manufacturing skills or food processing techniques local to a region. Essentially, the reputation that is associated with a GI is the intrinsic element that sells the product and contributes to the success of the industry that uses the GI. The geographical area of origin is therefore at the heart of all GIs and represents the normative basis for GI protection.Footnote 16
As mentioned earlier, the increase in the number of applications for GI registration in Malaysia suggests the growing importance of GIs for trade in the country. A number of reasons may be proffered for the increase in the number of GIs registered each year with the Intellectual Property Office of Malaysia (IP Office). First, with the public awareness campaigns conducted by the IP Office, the relevant industries and stakeholders, there is now a significant conscious awareness among the public in Malaysia of the functions of GIs and their utility in the course of trade, as well as the legal benefits of seeking GI registration. Second, with a clearer understanding that GIs enable producers to differentiate their offerings from those of other producers because of the unique quality and characteristics that are attributed to production in a particular location of the country, producers are better equipped to use their GIs as a basis for branding and promotion of their products. Accordingly, GI producers are able to gain competitive advantages in the marketplace, thanks to the value added by identifying their products with GIs. Third, with the perceived or actual quality differences imbued in the public mind between GI-denominated products and generic products, GI producers are able to command premium pricing for their products.
The importance of GIs as assets of great value in trade may be demonstrated through the following two illustrations: The first illustration concerns disputes that arose between Malaysia and Indonesia a few years ago over allegations that Malaysia had asserted ownership of some GIs and cultural icons that Indonesia claimed it owned.Footnote 17 For instance, Indonesia had claimed ownership over the textile art of batik, which involved the practice of dyeing cloth through wax-resistant methods. At the same time, the batik industry is also an important part of Malaysian cultural heritage, which has garnered widespread popularity. In Malaysia, the batik industry is a bustling commercial activity and an important source of commercial income for those involved in the industry.Footnote 18 Another example is the registration of Bario rice under the GIA 2000 by an agency of the Sarawak state government. Indonesia claimed that the rice was originally known as Beras Adan and had originated from the local rice area of Malinau in East Kalimantan.Footnote 19 During the same period of time, tension had also arisen over Indonesia’s claim that Malaysia had asserted ownership of some of their cultural icons, such as the sacred Balinese temple dance known as the pendet dance, the shadow puppet theatre known as the wayang kulit, the folksong Rasa Sayang, the ceremonial dagger known as the kris and the meat dish known as rendang.Footnote 20 While these cultural icons are not registered as GIs, the disputes show that the controversies over the geographical origin of a product, which also embodies an important part of national or local cultural heritage, can potentially create barriers to trade and raise issues regarding the importance of elements of national culture, as disputes over these elements can result in creating tension in international relations.
The second illustration concerns the inclusion of issues related to GI protection in free trade agreements, namely those signed by Malaysia with other countries. In particular, in the Malaysia-Chile Free Trade Agreement, which was concluded in 2010, Malaysia was required to recognise the Chilean Pisco GI, but without prejudice to Malaysia’s right to also recognise the Pisco GI from Peru. Similarly, the ASEAN-Australia-New Zealand Free Trade Agreement requires signatory parties to recognise that GIs may be protected through a trademark system. In addition, parties are also to recognise that where a trademark predates a GI within the jurisdiction, parties are required to continue to protect that trademark over the GI.Footnote 21 Currently, Malaysia is engaged in negotiations with the European Union (EU) on the Malaysia-European Union Free Trade Agreement (MEUFTA), whose negotiations started in 2010. One of the issues at the negotiating table amongst other intellectual property rights is precisely the legal protection of GIs.Footnote 22 Although the final content of the agreement has yet to take some form, it is likely that insofar as GI issues are concerned, Malaysia’s obligations on the protection of GIs will closely resemble that found in the European Union-Singapore Free Trade Agreement (EUSFTA).Footnote 23 To a large extent, the EUSFTA shares many similar obligations with the South Korea-European Union Free Trade Agreement.Footnote 24 Assuming that the MEUFTA’s provisions on GIs will parallel that of the Singapore and South Korea counterparts, it would appear that the enhanced level of protection currently granted to wines and spirits under the GIA 2000 will be extended to a broader category of goods in Malaysia, such as agricultural products and foodstuffs. In addition, it is likely that the MEUFTA will include specific provisions in the event of conflicts between trademarks and GIs, namely it may require that a GI is not to be protected if such protection would result in conflict arising with an existing well-known trademark, and consumers would be misled as to the true identity of the product. Apart from that, rightholders may be obliged to maintain minimal commercial activity of their GIs for continued protection and also to put in place control provisions for production of the goods.
3 Current Legal Protection of Geographical Indications in Malaysia
Since the TRIPS Agreement does not mandate any specific system for the protection of GIs, Malaysia had opted to adopt a sui generis regime for the protection of GIs rather than make changes to its existing intellectual property laws. Although the notion of GIs as a distinct type of intellectual property right with its own content and characteristics was statutorily embodied in Malaysia only fifteen years ago with the adoption of the GIA 2000, prior to that date a patchwork of different laws existed that could be invoked to protect GIs. The more significant laws in this respect are the law of passing off, the TMA 1976,Footnote 25 the CPA 1999Footnote 26 and the law on trade descriptions.Footnote 27 Nevertheless, the only reported court decision prior to the enactment of the GIA 2000 where a GI was contested was The Scotch Whisky Association & Anor v. Ewein Winery (M) Sdn Bhd,Footnote 28 and it was argued solely on the basis of the law of passing off without reference to any of the other areas of law. The case demonstrates that GIs, though not a defined category of intellectual property right at that time, were already perceived by industries as meriting some form of legal protection.
3.1 Protection under the Geographical Indications Act of 2000
The GIA 2000Footnote 29 was enacted for the express purpose of providing protection for GIs in Malaysia. A ‘GI’ is defined in section 2 of the GIA 2000 as ‘an indication which identifies any goods as originating in a country or territory, or a region or locality in that country or territory, where a given quality, reputation, or other characteristic of the goods is essentially attributable to their geographical origin’.Footnote 30 This reproduces the definition of a GI in Article 22(1) of the TRIPS Agreement and underscores the triple association between the goods, their quality or other characteristics and the geographical origin.Footnote 31 Section 2 of the GIA 2000 defines ‘goods’ as ‘any natural or agricultural product or any product of handicraft or industry’. It follows from this definition that services do not fall within the meaning of a GI and are accordingly excluded from the protection of this regime.
The GIA 2000 also creates a system for the registration of GIs, but it does not make registration mandatory as a precondition for entitlement to the protection afforded by it. Instead, the GIA 2000 provides that the same scope of protection is conferred on both registered and unregistered GIs. This is made clear in section 3(1)(a), which states that protection under the Act shall be given to a GI regardless of whether or not it is registered.Footnote 32 However, although registration is not a prerequisite for protection, there are benefits a proprietor of a registered GI enjoys that are not available in the case of unregistered GIs. Pursuant to section 20(1), a registered GI shall, in any proceeding, raise a presumption that the indication is a GI within the meaning of the Act.Footnote 33 Apart from this, section 20(2) provides that a certificate of registration shall be prima facie evidence of the facts stated in the certificate and of the validity of the registration.Footnote 34 Also, pursuant to section 21(1), only producers carrying on their activity in the geographical area specified in the Register shall have the right to use a registered GI in the course of trade.Footnote 35
Overall, the GIA 2000 deals with two main aspects of GI protection: First, Parts II and VI of the GIA 2000 translate Malaysia’s obligations under Articles 22,Footnote 36 23Footnote 37 and 24Footnote 38 of the TRIPS Agreement into domestic law. Second, Parts III, IV, V and VII of the GIA 2000 deal with the registration of GIs and matters pertaining to GI registration, such as the administration of the registration system, the procedure for registration and opposition, renewal of registration, cancellation and rectification of the Register, and exceptions to the right to use a GI. In this respect, the GIA 2000 effectively created a sui generis system for GI protection in Malaysia, which paved the way for many GI registrations and for the growing acceptance of GIs as important tools to secure exclusive rights on geographical names for producers in various sectors of the Malaysian economy.
3.1.1 Protectable Geographical Indications
The GIs that are protectable in Malaysia are specified in section 3 of the GIA 2000,Footnote 39 and include all GIs that satisfy the definition of a GI in section 2.Footnote 40 In addition, section 3(b) provides that protection is also granted to a GI as against another GI which, although literally true as to the geographical area of origin, falsely represents to the public that the goods originate in another geographical country, territory, region or locality.Footnote 41 With regard to homonymous GIs for wines, section 7(1) states that protection shall be accorded to each indication, but the Registrar of Geographical Indications shall determine the conditions under which the homonymous GIs will be differentiated from each other so as to ensure the producers enjoy equal treatment and the public is not misled.Footnote 42
Section 4 excludes four types of GIs from protection under the GIA 2000, although these may in appropriate cases be protected by other areas of law such as the law of passing off.Footnote 43 These are GIs that do not correspond to the meaning of a ‘GI’ as defined in section 2,Footnote 44 GIs that are contrary to public order or morality,Footnote 45 GIs that are not or have ceased to be protected in their country or territory of originFootnote 46 and GIs that have fallen into disuse in their country or territory of origin.Footnote 47
3.1.2 The Registration System for Geographical Indications in Malaysia
The administration of the registration system in Malaysia is overseen by the Registrar of Geographical Indications who is assisted by Deputy Registrars of Geographical Indications and Assistant Registrars of Geographical Indications.Footnote 48 For the purpose of registration of GIs, a Central Geographical Indications OfficeFootnote 49 was set up and a Register of Geographical Indications was created to record relevant particulars pertaining to registered GIs.Footnote 50
Pursuant to section 11(1) of the GIA 2000, an application for the registration of a GI may be made by any person (or group of persons) who is a producer of goods in the specified geographical area, a competent authority or a trade organisation or association.Footnote 51 In this respect, the term ‘producer’ encompasses a number of different entities. Section 2 defines a ‘producer’ as any producer or trader of agricultural products, any person or trader exploiting natural products and any manufacturer or trader of products of handicraft or industry. A ‘competent authority’ is defined as ‘any government or statutory body carrying out the functions of, on behalf of, or sanctioned by, the Government’.Footnote 52
When applying for registration, the applicant submits his personal particulars,Footnote 53 the GI for which registration is sought,Footnote 54 the geographical area and goods for which the GI applies,Footnote 55 and the quality, reputation or other characteristic of the goods for which the GI is used.Footnote 56 If the applicant complies with these formality requirements and the Registrar is satisfied that the GI is not contrary to public order and morality, the Registrar shall advertise the application in the Gazette.
Any ‘interested person’, who is defined as a person entitled to file an application for the registration of a GI laid down in section 11(1), may oppose the application only on one of the following four grounds: where the GI does not fall within the meaning of a GI under the GIA 2000,Footnote 57 where the GI is contrary to public order or morality,Footnote 58 where the GI is not or has ceased to be protected in its country of originFootnote 59 or where the GI has fallen into disuse in its country of origin.Footnote 60 The GIA 2000 lays out a procedure for reply by the applicant and a subsequent response to that reply by the opponent. Based on the parties’ submissions, the Registrar makes a decision either to refuse the registration or to register the GI with or without conditions or limitations imposed.Footnote 61 The GIA 2000 provides an avenue of appeal to the High Court from the Registrar’s decision,Footnote 62 and no further appeal is allowed from the High Court’s decision.Footnote 63
The period of registration of a GI is ten years from the date of filing,Footnote 64 and registration is renewable for a period of ten years each.Footnote 65 There is no limit to the number of renewals that may be made, which endorses the function of GIs as identifiers that link a product to a particular origin and, accordingly, the right of producers in the geographical region to use the GI in perpetuity. However, the failure to renew a GI will result in its removal from the Register.Footnote 66 But this does not diminish the right of the producers to use the GI concerned. The removal from the Register simply means that the GI will not be accorded the rights accrued to registered holders of GIs under the Act – namely the endorsement that the identifier used by the producers is a GI and the evidential benefit of registration. Nevertheless, the Registrar may restore a GI that has been removed from the Register if an application for restoration is made within twelve months from the date of expiry.Footnote 67 The application for restoration will only be granted if the Registrar is satisfied that there has been no use in bad faith of the GI during the year immediately preceding its removal, and no deception or confusion is likely to arise from the use of the GI by reason of its previous use.Footnote 68
The Act also provides for the possibility of cancellation and rectification of a registration. Any ‘interested person’ may request the cancellation of a GI on the ground that it does not qualify for protection because it is excluded from protection under section 4.Footnote 69 An application for the rectification of the registration of a GI may be made on the ground that the geographical area specified in the registration does not correspond to the GI, the indication of the products for which the GI is used is missing or the indication of the quality, reputation or other characteristic of the products is unsatisfactory.Footnote 70 In its plain and ordinary meaning, ‘cancellation’ refers to the expungement of the whole of a GI from the Register, while ‘rectification’ denotes the varying or correcting of an entry or the imposition by the Registrar of limitations.
3.1.3 Rights Conferred upon Registration and Exceptions
Upon registration, section 21(1) of the GIA 2000 provides that only producers carrying on their activity in the geographical area specified in the Register shall have the right to use a registered GI in the course of trade.Footnote 71 In this respect, GIs do not grant a monopoly right akin to that of a patent, a registered trademark or a registered industrial design because the right to use a registered GI belongs jointly to the producers carrying on their activity in the geographical area specified in the Register and is not limited to any particular enterprise. Essentially, GIs grant an exclusive right that aims at protecting the collective reputation that is embedded in the GI and is shared by, as well as accrues to, all enterprises in the geographical area that meet the requirements for use of the indication. It is this reputation revolving around a GI that helps to reduce consumers’ search costs. This is because in a market marked by asymmetry of information, the valuable information intrinsic in a GI sends signals to consumers about the quality of a product. While benefiting consumers by providing them with accurate information that links a product with its qualities and geographical origin, GI protection also benefits the producers of the goods by protecting them against the unauthorised use of GIs by third parties.Footnote 72
Pursuant to section 21(2) of the GIA 2000, the right to use a GI is confined to the products specified in the Register in accordance with the specified quality, reputation or characteristics.Footnote 73 Section 20(1) states that a registered GI shall raise a presumption that the indication is a GI within the meaning of section 2, which provides the rightholder with some degree of certainty.Footnote 74 In addition, by section 20(2), a certificate of registration shall be prima facie evidence of the facts stated in the certificate and of the validity of the registration.Footnote 75
The rights conferred upon registration are circumscribed in the situations mentioned in sections 27(2), 28 and 29 of the GIA 2000.Footnote 76 Essentially, these are defences that may be raised in an action against any person who infringes the rightholder’s exclusive right. Pursuant to section 27(2), no legal proceedings shall be brought under the Act against another person in respect to his/her use of a GI prior to the commencement of the GIA 2000, that is, 15 August 2001.Footnote 77 Section 28 provides for the right to the continued use of a GI in respect of winesFootnote 78 and spirits where the use had commenced prior to certain specified dates.Footnote 79 According to section 28(1), where a GI of another country identifying wines or spirits has been used in connection with goods or services by any national or domiciliary of Malaysia and that use has been in a continuous manner with regard to the same or related goods or services in Malaysia either for at least ten years before 15 April 1994,Footnote 80 or in good faith before that date, the user has the right to continue with the use in Malaysia.Footnote 81 Apart from this, section 28(2) allows for the continued use or registration of a trademark that is identical with or similar to a GI where the use of the trademark or its registration took place before the commencement of the GIA 2000 (that is, 15 August 2001) or before the GI became protected in its country of origin.Footnote 82 This is consistent with the ‘first in time, first in right’ principle, which is supported by countries such as the United States (US) and provides that pre-existing trademarks should not be cancelled due to the subsequent registration of a foreign GI. Pursuant to section 28(3) of the GIA 2000, where a GI is identical with a generic word in Malaysia for the goods concerned, no protection will be granted to the GI under the Act.Footnote 83 A final exception to the rights given upon registration is provided in section 29, which allows any person to use his name in the course of trade unless the use is in such a manner as to mislead the public.Footnote 84
3.1.4 Institution of Proceedings to Prevent the Unlawful Use of a GI
According to section 5(1) of the GIA 2000, any ‘interested person’ may institute proceedings in the court to prevent the unlawful use of a GI, irrespective of whether the GI is registered or otherwise.Footnote 85 As mentioned earlier, an ‘interested person’ is defined in section 11 as either a producer of the goods in the geographical area concerned, a competent authority or a trade organisation or association.Footnote 86 From a commercial perspective, by explicitly providing for the institution of legal proceedings to curb the unauthorised use of a GI, section 5(1) ensures that the authenticity of the origin of a product is preserved. In some cases, the producers of a GI product become members of a trade association or society that is entrusted with the promotion of their rights and interests and protects them against the unauthorised use of the GI by third parties. For instance, in The Scotch Whisky Association & Anor v. Ewein Winery (M) Sdn BhdFootnote 87 and Chocosuisse Union des Fabricants Suisses de Chocolat & Ors v. Maestro Swiss Chocolate Sdn Bhd & Ors,Footnote 88 which are discussed later in this chapter, the actions were instituted by the respective trade associations together with a few other producers having the right to use the GI to defend the reputation of the respective GIs.
Section 5(1) of the GIA 2000 spells out four situations in which the use of a GI, whether registered or otherwise, is deemed to be unlawful. First, under section 5(1)(a), the use of a GI is unlawful if in the course of trade its use in the designation or presentation of any goods suggests that the goods originate in a geographical area other than the true place of origin and this has the effect of misleading the public.Footnote 89 This is a basic level of protection conferred on all GI products. Second, under section 5(1)(b), it is unlawful for any GI to be used in the course of trade if the use constitutes an act of unfair competition within the meaning of Article 10bis of the Paris Convention for the Protection of Industrial Property (1967).Footnote 90 Third, pursuant to section 5(1)(c), it is unlawful to use in the course of trade a GI which, although literally true as to the geographical area in which the goods originate, falsely represents to the public that the goods originate in another geographical area.Footnote 91 Fourth, in the case of wines and spirits, section 5(1)(d) provides that it is unlawful in the course of trade to use a GI if the wine or spirit does not originate in the place indicated by the GI in question. The use remains unlawful even where the true origin of the wines or spirits is indicated or the GI is accompanied by expressions such as ‘kind’, ‘type’, ‘style’ or ‘imitation’.Footnote 92 There is no necessity to demonstrate that consumers might be misled or that the use constitutes unfair competition. A distinction is thus made between the levels of protection accorded to goods generally on the one hand and wines and spirits on the other. Wines and spirits enjoy an enhanced level of protection compared to other GI products. This is in line with the requirement laid out in Article 23 of the TRIPS Agreement.Footnote 93
Pursuant to section 7(1) of the GIA 2000, in the case of homonymous GIs for wines, protection shall be accorded to each indication.Footnote 94 In such a case, section 7(2) requires the Registrar to determine the practical conditions under which the homonymous GIs in question will be differentiated from each other.Footnote 95 This would entail taking into account the need to ensure equitable treatment of the producers affected and the concern that the public not be misled.
The court may grant an injunction to prevent any unlawful use of a GI, award any damages or grant other legal remedy as it deems fit.Footnote 96 Where a legal proceeding brought under section 5 is to prevent the use of a trademark which contains or consists of a GI, a time limit to commence the action is set by section 6.Footnote 97 Pursuant to section 6, unless bad faith is involved, no action shall be brought after the expiry of five years from the date the use of the trademark containing the GI has become generally known in Malaysia or from the date of registration of the trademark under the TMA 1976, whichever is earlier.Footnote 98 In the case of bad faith use or registration, no time limit for bringing an action is imposed.Footnote 99
Where a GI exists before the coming into force of the GIA 2000, section 27(2) provides that no legal proceedings shall be brought for anything done before the coming into force of the Act.Footnote 100 Section 27(2) was applied recently in the Federal Court case Maestro v. Chocosuisse.Footnote 101 In this case, the plaintiffs, who were the respondents before the Federal Court, were Swiss chocolate manufacturers (except for the first respondent who was a trade association for Switzerland-based chocolate manufacturers). The respondents sued the appellants for passing off and infringement of GIs because the latter had used the mark ‘Maestro Swiss’ on the packaging of their chocolates and chocolate products. Both the Federal Court and Court of Appeal allowed the respondents’ claim for passing off. However, the Federal Court disagreed with the Court of Appeal’s finding that the respondents’ claim under the GIA 2000 should be dismissed. The Federal Court opined that the Court of Appeal had erred when it held that section 27(2) of the Act applied in the case and therefore precluded any action brought for anything done prior to the commencement of the Act. The arguments based on passing off are discussed below, but insofar as the arguments based on the Act are concerned, the Federal Court held that the word ‘Swiss’ for chocolates and chocolate-related products satisfied the definition of a GI under section 2 of the GIA 2000 in that it signified that the chocolates were made in Switzerland and of high quality. According to the Federal Court, the purpose of the respondents’ claim was to prevent the appellants from continuing to use the mark after the GIA 2000 came into force and ‘not so much for “anything done before the commencement of the Act.” ’.Footnote 102 The Federal Court held that if the decision of the Court of Appeal in allowing the application of section 27(2) was upheld, it would mean that the appellants could continue to use the mark despite the court’s finding that there had not been a bona fide use by the appellants of the respondents’ mark.Footnote 103 Another matter made clear by the case was that although there is a certain degree of overlap between an action brought pursuant to section 5(1) and one that is commenced under the law of passing off, section 5(1) does not preclude the application of the law of passing off.Footnote 104 Indeed, as Chocosuisse Union demonstrates, an action may be brought concurrently for passing off and infringement of GIs.
3.2 Other Forms of Legal Protection for Geographical Indications
3.2.1 Protection under the Law of Passing Off
Even with the enactment of the GIA 2000, passing-off law remains available to prevent the unauthorised use of a GI. Indeed, it is usual for a plaintiff to invoke the law of passing off and the protection under GIA 2000 in an action to prevent the unauthorised use of a GI. To demonstrate the continued importance passing-off law plays in protecting GIs, two decided cases that were argued primarily on passing-off law are discussed in this section.
The first case, The Scotch Whisky Association & Anor v. Ewein Winery (M) Sdn Bhd,Footnote 105 was decided before the enactment of the GIA 2000 and was argued solely on the basis of the law of passing off. The second case, Maestro v. Chocosuisse,Footnote 106 was decided after the GIA 2000 came into force and was argued largely on the basis of the law of passing off as the main contention and, to a lesser extent, on infringement of a GI under the Act. The latter case is useful to demonstrate the continued relevance of the law of passing off as a form of protection for GIs even after the enactment of the GIA 2000.
In The Scotch Whisky Association, the second plaintiffs were distillers, blenders and exporters of Scotch Whisky, being whisky distilled and matured in Scotland. The first plaintiff was a trade association that was concerned with the protection of the interest of the Scotch Whisky trade worldwide. The phrase ‘Scotch Whisky’ had acquired considerable international reputation and goodwill because of the intrinsic quality and characteristic of the product. The plaintiffs claimed that the defendants, who carried on the business of processors and bottlers of liquor in Penang, had passed off their spirits, which were not distilled in Scotland, as and for Scotch Whisky. The alleged acts of passing off included the defendants’ use of features of get-up with visual representations and labels suggesting Scottish origin, such as the prominent use of the words ‘Compounded Scotch Whisky’ and ‘Imported Scotch Whisky Distilled in Scotland under British Government Supervision’ on the packaging of their products. In determining whether the defendants had committed acts of passing off, the court applied the test laid down by Lord Diplock in Erven Warnink BV v. Townend & Sons (Hull) Ltd.Footnote 107 In this case, it was held that the plaintiff in a passing-off action was required to show, first, the existence of a misrepresentation; second, that was made by a trader in the course of trade; third, to prospective customers; fourth, that is calculated to injure the business or goodwill of another trader; and finally, that causes actual damage to a business or goodwill of the trader by whom the action is brought. In applying this test, the court found against the defendant for extended passing off and, accordingly, granted an order for an injunction and account of profits.
The factual matrix of the second case, Maestro v. Chocosuisse,Footnote 108 bears many similarities with the decision in The Scotch Whisky Association.Footnote 109 As mentioned earlier, the respondents, who were entities interested in the ‘Swiss’ GI when used in relation to chocolates or chocolate products, sued the appellants for using the name ‘Maestro Swiss’ on the packaging of their chocolates and chocolate-related products. In addition, the word ‘Swiss’ appeared in bold white colour against a red rectangular box emulating the white and red colours of the Swiss flag. The respondents argued that the appellants had deliberately used the word ‘Swiss’ together with the red and white colours to deceive or mislead the public into thinking that the appellants’ products originated in Switzerland.Footnote 110 At first instance, the trial judge rejected the market survey evidence conducted by the respondents, which indicated that there was confusion among members of the public that the words ‘Maestro Swiss’ denoted chocolates that originated in Switzerland. The reasons for the rejection were that the survey failed to represent a true cross-section of the chocolate-buying public in Malaysia, the questionnaire contained leading questions and the survey was conducted only four years after the filing of the action. The trial judge found that the appellants’ use of the words ‘Maestro Swiss’ instead of ‘Swiss chocolates’ did not create any false impression that the chocolates were made in Switzerland.Footnote 111 In addition, the trial judge opined that the appellants’ packaging was sufficiently distinctive so much so that no reasonable person would be led to think that the chocolates were made in Switzerland.Footnote 112 On appeal, the Court of Appeal, while agreeing that the court should be cautious in accepting survey evidence, held that the trial judge had erred in not giving any consideration at all to the results of the survey.Footnote 113 Contrary to the trial judge’s decision, the appellate court relied on the outcome of the survey and concluded that there was likelihood of confusion in the minds of some members of the public that the appellants’ chocolates were made in Switzerland.Footnote 114 This point on the admissibility of survey evidence was affirmed by the Federal Court. Importantly, the Federal Court emphasised that the case was one of extended passing off instead of passing off in its classical form because the respondents had misrepresented that their products were of the kind that enjoyed the reputation and goodwill attached to chocolates made in Switzerland.Footnote 115 Unlike extended passing off, passing off in its classical form is concerned with the protection of the goodwill of a particular trader’s business.
A final important point, which the Federal Court clarified, concerned the locus standi of the first respondent in bringing a passing-off action against the appellants. The first respondent was a trade association that, inter alia, had the responsibility of protecting the designation ‘Swiss Chocolates’ or words that indicated that the chocolates had Swiss origin. The trial judge held that since the first respondent neither sold nor manufactured chocolates, they did not have any goodwill in the chocolate business and, accordingly, did not have any locus standi to bring the passing-off action.Footnote 116 However, the Court of Appeal overturned this finding and instead held that the first respondent, being a trade association, shared a common interest with its members in protecting the designation ‘Swiss chocolate’ and the goodwill associated with chocolates of Swiss origin.Footnote 117 The court also found support from two earlier decisions, the English case of Chocosuisse Union des Fabricants Suisse de Chocolat and Others v. CadburyFootnote 118 and the above-mentioned case The Scotch Whisky Association,Footnote 119 which accepted without controversy, the locus standi of trade associations to bring passing-off actions to protect the interests of their members. The Federal Court disagreed with the Court of Appeal and found that the trial judge was correct in holding that the first respondent did not have any locus standi to commence the passing-off action because it did not have any business interest or goodwill which it was entitled to protect by way of passing off in Malaysia.Footnote 120 The position differs with regard to the action under the GIA 2000. The Federal Court agreed with the Court of Appeal that the first respondent qualified as an ‘interested person’ within section 11 of the GIA 2000 and fell within the categories of persons entitled to register a GI. Accordingly, the Court held that the first respondent had locus standi to bring an action under the GIA 2000.Footnote 121
The importance of the law of passing off in resolving disputes that essentially are attempts to protect the geographical origins of products continues even after the enactment of the GIA 2000, as is evident from the case of Maestro v. Chocosuisse.Footnote 122 Passing-off law prevents misrepresentation to be made to third parties in the course of trade as to the geographical origin of a product and, as such, is aptly suitable to be added as a cause of action in legal proceedings apart from that provided under the GIA 2000.
3.2.2 Protection under the Trade Marks Act 1976
There are provisions under the TMA 1976Footnote 123 that are sufficiently broad to offer some degree of protection of GIs, even though some of these were not enacted for the specific purpose of protecting such indications. Section 56 of the TMA 1976 provides that a mark is registrable as a certification mark if it is used in relation to goods or services for the purpose of distinguishing in the course of trade such goods or services in respect to origin, material, mode of manufacture, quality, accuracy or other characteristics from goods or services not so certified.Footnote 124 Certification marks thus indicate that the goods or services that use the marks have specific characteristics or originate from certain geographical regions.
Sections 14(1)(f) and 14(1)(g) were inserted by the Trade Marks (Amendment) Act 2000 in response to Malaysia’s obligations under the TRIPS Agreement to protect GIs.Footnote 125 Pursuant to section 14(1)(f), the registration of any trademark that contains or consists of a GI with respect to goods not originating in the territory indicated is prohibited if its use in Malaysia is of such a nature as to mislead the public as to the true place of origin of the goods.Footnote 126 Section 14(1)(g) prohibits the registration of a mark for wines or spirits that do not originate in the place indicated by the GI even if the mark does not mislead the public.Footnote 127 Exceptions to section 14(1)(f) and section 14(1)(g) are made in the case of good-faith use or where the registration of the trademark took place either before the commencement of the GIA 2000 or before the GI was protected in the country of origin.Footnote 128
Apart from the above provisions, section 14(1)(a), which prohibits the registration of a trademark that is likely to deceive or cause confusion to the public, has also been successfully invoked to remove from the Register a registered trademark comprising a GI.Footnote 129 In The Agricultural and Processed Food Products Export Development Authority of India (APEDA) & Ors v. Syarikat Faiza Sdn Bhd,Footnote 130 the respondent had applied for registration of the word ‘Ponni’ for rice prior to the coming into force of the GIA 2000. The application was successful and the word ‘Ponni’ was registered in the respondent’s name. Subsequently, the applicants applied to expunge the respondent’s trademark on the ground that ‘Ponni’ denoted a particular variety of rice cultivated in the Ponni region in Tamil Nadu, India. The rice is known for its benefits to diabetic patients. The court held that the word ‘Ponni’ was not a distinctive mark that denoted that the rice originated from any particular trader but rather was a word that denoted a particular variety of rice from the Tamil Nadu region. Accordingly, the court held that the respondent was not entitled to the registration of the ‘Ponni’ trademark.Footnote 131 In addition, relying on section 14(1)(a) of the TMA 1976, the court held that the use of ‘Ponni’ as a trademark for rice not originating in the Tamil Nadu region was likely to mislead the public. The respondent’s mark was held to be an entry wrongly made and wrongly remaining in the Register and, thus, was ordered to be removed from the Register.Footnote 132
3.2.3 Protection under the Trade Descriptions Act 2011
The TDA 2011 states that it is an offence to use false trade descriptions in relation to the supply of goods.Footnote 133 As a trade description is defined to include an indication of the place of production of any goodsFootnote 134 and the TDA 2011 makes it an offence to apply a false trade description to any goods,Footnote 135 the TDA 2011 is an additional mechanism to protect GIs.
3.2.4 Protection under the Consumer Protection Act 1999
Section 10(1)(l) of the CPA 1999 prohibits any person from making a false or misleading representation that concerns the place of origin of the goods.Footnote 136 A representation that a product originates from a geographical area when it does not is a criminal offence under section 25.Footnote 137 Nevertheless, in the light of the fact that the purpose of the Act is to protect consumers and not the producers of goods,Footnote 138 it would appear that the applicability of the CPA 1999 in the context of protection of GIs is of incidental relevance only.
4 Is the Scope Protection for Geographical Indications in Malaysia Adequate?
As discussed above, the principal area of law that protects GIs is the GIA 2000, which provides for a registration system but does not make registration mandatory for protection in Malaysia. Nevertheless, GI registration is beneficial because only producers carrying on activities in the geographical area specified in the Register are entitled to exclusively use the GI in the course of trade. By the same token, producers of the same type of product from another geographical region are not permitted to use the same GI. Moreover, registration raises a presumption that the indication is a GI, thereby giving producers more confidence when using their distinguishing indicia as a marketing tool. Likewise, consumers can confidently place their trust in a product bearing a GI mark since they are assured of the geographical origin of the product. Further, registration is prima facie evidence that the registered GI is indeed a GI, which also means that in legal proceedings the burden lies with the party challenging the legitimacy of the GI to prove his case.
Overall, the framework of the GIA 2000 provides a satisfactory scope of protection for GIs in Malaysia, particularly with respect to the provisions regarding the types of GIs that may be registered, the persons who qualify to apply for registration, the rights acquired by the registered holder upon registration, the procedure for registration, the institution of legal proceedings for the unlawful use of a GI, the defences in an action for the infringement of a registered GI and the rectification of the Register. In fact, the framework closely mirrors the general layout of the other, more established intellectual property statutes, such as the TMA 1976,Footnote 139 the Patents Act 1983Footnote 140 and the Industrial Designs Act 1996.Footnote 141
Be that as it may, it is suggested that there is scope for further improvements to the GIA 2000 in order to have in place a more robust regime for the protection of GIs in Malaysia.
First, as consumers have come to expect that GIs connote a certain level of product quality, it is proposed that provisions be inserted in the Act to preserve the producer-quality-geographical region link by requiring rightholders to maintain a minimum level of quality in their products. Second, rightholders should be required to ensure that at least a minimal level of commercial activity is carried out in relation to the registered GI. Third, pursuant to section 13 of the GIA 2000, in an application for registration, the Registrar is currently only required to conduct an examination of the formal requirements of the Act. The formal requirements are spelt out in section 12(1), and these include stating the particulars of the applicant,Footnote 142 the GI and geographical area for which registration is sought,Footnote 143 the goods for which the GI applies,Footnote 144 the quality or other characteristic of the goods for which the GI is usedFootnote 145 and any other particulars which may be prescribed by the Minister under section 32 of the Act.Footnote 146 If these requirements are complied with and the GI is not contrary to public order or morality, the Registrar shall advertise the application. In addition to this formal examination, it is recommended that the Registrar additionally conduct a substantive examination of the application, particularly to ensure that the indication applied for meets the definition of a GI and genuinely embodies the characteristics claimed for a product originating from the geographical region. This may require the assistance of expert assessors, which may be costly. However, a substantive examination is increasingly important to guarantee the actual quality and quality control of the GI-denominated products. Also, through a substantive examination, the examiner should check for possible conflict with existing trademarks, whether registered or not.
Fourth, under the TMA 1976, there are provisions for border enforcement measures to combat trademark-counterfeiting activities at the borders of the country through the seizure of counterfeit goods.Footnote 147 A parallel system could be put in place for GI protection for the same purpose. The final suggestion relates to an ambiguity that arises from a reading of section 3 of the GIA 2000. As mentioned earlier, section 3 states that protection under the GIA 2000 shall be given to a GI regardless of whether or not it is registered under the Act.Footnote 148 Yet, section 21(1), which spells out the exclusive right of a rightholder, states that ‘[i]n the case of registered geographical indications, only producers carrying on their activity in the geographical area specified in the Register shall have the right to use a registered geographical indication in the course of trade’.Footnote 149 This section is amenable to two possible interpretations: On the one hand, by section 3 extending the protection granted under the Act to all unregistered GIs, it may be argued that the exclusive right under section 21(1) applies equally to unregistered GIs. On the other hand, the opening words of section 21(1) appear to qualify the applicability of the section only to registered GIs, which would mean that only registered GIs enjoy the exclusive right under the section. This apparent ambiguity should be addressed by Parliament, which should clarify that only registered GIs enjoy the exclusive rights provided under the Act.
5 Conclusion
It is not an exaggeration to explicitly state that a GI is a singular marketing tool that encapsulates important information about the triple association that exists between a product, its quality or other unique characteristic, and its geographical origin. As GI products often command premium prices, they play an important role in the development of rural areas, which are usually the regions that produce such products and, by extension, are able to contribute to the social and economic development of a country. The valuable information embodied in a GI renders it a valuable commercial asset, which merits legal protection against the unauthorised use by third parties. The discussion above has examined the scope of protection of GIs in Malaysia, emphasising the sui generis protection under the GIA 2000 and outlining the protection under the common law of passing off as well as the statutory protection under the TMA 1976, the TDA 2011, and the CPA 1999. Based on the earlier discussion, it may be surmised that as a whole, the overall scope of protection for GIs in Malaysia creates a suitable environment for the protection of GIs. Nevertheless, as recommended above, there is room for improvement of the GIA 2000 in order to provide a more comprehensive scope of GI protection under the law in Malaysia.
Open access