Date: Feb 9, 2001

Direct Enforcement of Protected Designations of Origin: Insights from Consorzio Del Prosciutto Di Parma v. Asda Stores Limited

Introduction

The case of Consorzio Del Prosciutto Di Parma v. Asda Stores Limited and Others ([2001] UKHL 7) is a landmark decision by the United Kingdom House of Lords that addresses the enforceability of European Community regulations concerning Protected Designations of Origin (PDO) within member states' courts. The dispute centered around the unauthorized marketing of sliced and pre-packaged Parma ham by Asda, a major UK supermarket chain, which allegedly violated both Italian and European regulations governing the protection of PDOs.

Summary of the Judgment

The Consorzio del Prosciutto di Parma, acting as the enforcement authority under Italian law, sought an injunction against Asda Stores Limited and Hygrade Foods Ltd for marketing sliced Parma ham without the requisite 'corona ducale' mark. The initial rulings in the High Court and Court of Appeal dismissed the Consorzio's claims, asserting that European regulations did not confer directly enforceable rights in member state courts. However, upon appeal to the House of Lords, the court recognized the complexity of the matter and the necessity to refer specific legal questions to the European Court of Justice (ECJ) for a preliminary ruling. This referral underscores the intricate relationship between national laws and overarching European regulations regarding PDOs.

Analysis

Precedents Cited

The judgment references several key cases that shape the interpretation of European Community law in the context of PDOs:

Consorzio per la Tutela del Formaggio Gorgonzola v Käserei Champignon Hofmeister GmbH & Co KG ([1999] Case C-87/97)
Foto-Frost v Hauptzollamt Lübeck-Ost (Case 314/85)
H J Banks & Co Ltd v British Coal Corporation (Case C-128/92)
Terrapin (Overseas) Ltd v Terranova Industrie CA Kapferer & Co ([1976] 2 ECR 1039)
Hoffman-La-Roche & Co AG v Centrafarm Vertriebsgesellschaft Pharmazeutischer Erzeugnisse mbH & Co KG ([1978] 2 ECR 1139)
Pfiser Inc v Eurim-pharm GmbH (Case 1/81)

These cases provide a foundation for understanding the direct applicability and enforceability of European regulations within member state jurisdictions, particularly concerning intellectual property rights and product authenticity.

Legal Reasoning

The House of Lords meticulously examined whether the relevant European regulations intended to create directly enforceable rights that UK courts could uphold without additional national legislation. Lord Nicholls emphasized that unlike directives, which require member states to implement them through domestic laws, regulations are intended to be directly applicable and binding in their entirety across all member states.

He further analyzed Council Regulation (EEC) No 2081/92 and Commission Regulation (EC) No 1107/96, highlighting their provisions for registering and protecting PDOs. The core issue was whether these regulations provided enough specificity and transparency to allow individuals to enforce them directly in UK courts. While acknowledging the regulation's intention for direct enforceability, Lord Nicholls identified ambiguities related to the accessibility and precise application of slicing and packaging requirements outside the Parma region, prompting the need for a preliminary ruling from the ECJ.

Lord Scott of Foscote echoed the necessity for judicial clarification on whether re-packaging genuine Parma ham outside the designated area without the 'corona ducale' mark infringed upon the PDO regulations.

Impact

This judgment has significant implications for the enforcement of PDOs and similar designations within the European Union. By referring essential questions to the ECJ, the House of Lords underscored the complexities involved in balancing national regulations with overarching EU laws. The decision highlights the necessity for clear, accessible regulatory frameworks that allow for effective enforcement while maintaining the integrity of protected designations.

Furthermore, the case sets a precedent for how future disputes regarding PDOs and geographical indications will be approached, emphasizing the role of the ECJ in resolving ambiguities and ensuring uniform application of EU regulations across member states.

Complex Concepts Simplified

Protected Designations of Origin (PDO)

A PDO is a designation used within the European Union to protect the names of specific products that are produced, processed, and prepared in a given geographical area using recognized know-how. It ensures that only products genuinely originating in that region can be marketed under the protected name, preserving the product's reputation and authenticity.

Direct Enforceability of Regulations

Direct enforceability refers to the ability of individuals or entities to invoke and rely on certain regulations directly in national courts without the need for additional national implementing legislation. In the context of EU law, regulations are typically designed to be directly applicable and enforceable across all member states.

Exhaustion of Rights

The doctrine of exhaustion of rights implies that once a product protected by a designation of origin (or trademark) has been lawfully marketed within the EU by the rights holder or with their consent, the rights holder cannot prevent further resale or re-packaging of that product within the EU, provided that such actions do not alter the product's authenticity or misleadingly use the protected designation.

Preliminary Ruling

A preliminary ruling is a decision requested by a national court to the European Court of Justice on the interpretation of EU law. This mechanism ensures uniform application and interpretation of European regulations and directives across all member states.

Conclusion

The Consorzio Del Prosciutto Di Parma v. Asda Stores Limited case underscores the intricate interplay between national regulations and European Community law concerning protection schemes like PDOs. The House of Lords' decision to seek a preliminary ruling from the ECJ highlights the need for clarity and uniformity in enforcing PDOs across member states. The judgment reinforces the importance of accessible and transparent regulatory frameworks to ensure that protected designations uphold their intended purposes of safeguarding product authenticity and consumer trust.

Ultimately, this case serves as a pivotal reference point for future disputes involving PDOs and similar designations, emphasizing the critical role of the European Court of Justice in harmonizing interpretations and applications of EU laws to maintain the integrity and effectiveness of protections within the single market.

Case Details

Consorzio Del Prosciutto Di Parma v. Asda Stores Limited and Others

Year: 2001 Court: United Kingdom House of Lords

Judge(s)

LORDS DECISIONS, LORDS DECISIONS &GT;&GT;, LORDS, LORD NICHOLLS OF BIRKENHEAD LORD HOFFMANN LORD HOPE OF CRAIGHEAD LORD CLYDE LORD SCOTT OF FOSCOTE, LORDS OF APPEAL FOR JUDGMENT, LORD NICHOLLS OF BIRKENHEAD, LORDS,, LORD HOFFMANN AND LORD SCOTT OF FOSCOTE. I AGREE THAT, IN ORDER TO DECIDE THIS APPEAL, IT IS NECESSARY FOR THE HOUSE TO REFER TO THE EUROPEAN COURTS OF JUSTICE A QUESTION TO THE EFFECT MENTIONED BY LORD HOFFMANN., LORD HOFFMANN, LORDS,, LORDSHIPS' HOUSE., JUSTICE. SECONDLY, THEY SAY THAT UPON ITS TRUE CONSTRUCTION, IT WAS NOT INTENDED TO CREATE RIGHTS AND DUTIES DIRECTLY ENFORCEABLE IN THE COURTS OF MEMBER STATES. THIRDLY, THEY SAY IT SHOULD NOT BE ENFORCED BECAUSE THE EXTENT OF THE PROTECTION AFFORDED TO THE PDO WAS NOT PRECISELY DEFINED, OR NOT SUFFICIENTLY PUBLICISED, OR BOTH. ARGUMENTS OF THIS KIND MIGHT, AS IT SEEMS TO ME, BE REGARDED AS OPERATING IN ONE OF TWO WAYS: EITHER IN AID OF CONSTRUCTION, TO SUPPORT THE ARGUMENT THAT THE REGULATION WAS NOT INTENDED TO HAVE DIRECT EFFECT, OR ALTERNATIVELY, AS SHOWING THAT, AS A REGULATION INTENDED TO HAVE DIRECT EFFECT, IT SHOULD BE TREATED AS INVALID. THE LATTER FORM OF ARGUMENT WOULD AGAIN REQUIRE A REFERENCE TO THE EUROPEAN COURT. I AM NOT SURE THAT MR GREEN, WHO APPEARED FOR THE RESPONDENTS, ACCEPTED THIS LAST PROPOSITION. HE SUGGESTED, I THINK, THAT A REGULATION MIGHT BE INTENDED TO CREATE DIRECTLY ENFORCEABLE RIGHTS BUT NOT CREATE THEM FOR ONE OR OTHER OF THE REASONS UPON WHICH HE RELIES AND YET SOMEHOW BE VALID. I SHALL RETURN TO THIS POINT IN DUE COURSE. FOURTHLY, THE RESPONDENTS SAY THAT WHILE THE PDO MAY CONFER A DEGREE OF PROTECTION WHICH REQUIRES HAM SOLD AS PROSCIUTTO DI PARMA TO HAVE BEEN MADE IN PARMA, IT DOES NOT EXTEND TO A REQUIREMENT THAT PACKAGES SHOULD BEAR A MARK WHICH HAS TO BE APPLIED IN PARMA. THIS ARGUMENT AGAIN TAKES DIFFERENT FORMS. ONE IS THAT THE REGULATION, UPON ITS TRUE CONSTRUCTION, READ WITH THE DOCUMENTS TO WHICH IT REFERS, DOES NOT CONFER THE WIDER PROTECTION. ALTERNATIVELY, IF IT SHOULD BE SO CONSTRUED, THE COMMISSION DID NOT HAVE POWER UNDER THE REGULATION (OR POSSIBLY EVEN UNDER THE EEC TREATY (TREATY OF ROME) (CMND 5179-II)) TO REGISTER A PDO PURPORTING TO CONFER THE WIDER PROTECTION. THE LATTER FORM OF ARGUMENT WOULD AGAIN REQUIRE A REFERENCE., LORDS, I THINK THAT THE BEST PLACE TO BEGIN IS BY CONSIDERING WHETHER, AS A MATTER OF CONSTRUCTION, THE REGULATION WAS INTENDED TO CONFER PROTECTION UPON A PDO WHICH IS DIRECTLY ENFORCEABLE IN THE COURTS OF MEMBER STATES. ONCE ONE HAS DECIDED THIS QUESTION, THE OTHER ARGUMENTS PUT BEFORE YOUR LORDSHIPS TEND TO FALL INTO PLACE., LORD SIMONDS ONCE CALLED A "PIOUS ASPIRATION". (CUTLER V WANDSWORTH STADIUM LTD [1949] AC 398, 407)., JUSTICE SAID (IN PARAGRAPH 18, P 1331) THAT UPON THE REGISTRATION OF A PDO (IN THAT CASE, GORGONZOLA) NATIONAL RULES CEASED TO APPLY AND "ONLY THE LEGAL RULES LAID DOWN IN [THE REGULATION] ARE, TOGETHER WITH THE TREATY RULES, RELEVANT FOR THE PURPOSE OF ANSWERING THE QUESTIONS REFERRED [ABOUT THE SCOPE OF THE PROTECTION OF THE PDO]. THE WHOLE JUDGMENT (SEE, FOR EXAMPLE, PARAGRAPH 36) PROCEEDS ON THE ASSUMPTION THAT PROTECTION OF THE PDO IS NOW GUARANTEED BY COMMUNITY LAW., LORDSHIPS NEED BE CONCERNED ONLY WITH SECTIONS UNDER (G) (DETAILS OF INSPECTION STRUCTURES), (H) (LABELLING DETAILS) AND (I) (COMMUNITY AND NATIONAL REQUIREMENTS). PART H IS HEADED "SPECIFIC REQUIREMENTS CONCERNING THE PRESENTATION, IDENTIFICATION AND LABELLING OF PARMA HAM". IT REFERS TO AND SUMMARISES THE ITALIAN LEGISLATION TO WHICH I HAVE ALREADY REFERRED. PARAGRAPH H.2 SAYS:, LORDS, IT IS NOTICEABLE THAT THE JUDGE DISCUSSES "SLICING AND PACKAGING" WITHOUT IN ANY WAY CONNECTING THESE OPERATIONS TO THE REASON WHY THE ITALIAN AUTHORITIES REQUIRE THEM TO BE CONTROLLED AND SUPERVISED, NAMELY, FOR THE PURPOSE OF ENSURING THAT THE AUTHENTICITY OF THE PRODUCT IN SLICED FORM CAN BE GUARANTEED TO THE CONSUMER BY AN AUTHENTIC LABEL. THE PURPOSE OF PROTECTION OF THE PDO, ACCORDING TO THE RECITALS TO THE REGULATION, IS TO ENABLE THE CONSUMER TO "PURCHASE HIGH QUALITY PRODUCTS WITH GUARANTEES AS TO THE METHOD OF PRODUCTION AND ORIGIN". THE PDO WILL "ENHANCE THE CREDIBILITY OF THE PRODUCTS IN THE CONSUMERS' EYES". ARTICLE 4.2(H) SPECIFICALLY REQUIRES THAT "ABELLING DETAILS" BE INCLUDED IN THE SPECIFICATION. I CAN THEREFORE SEE NO REASON WHY LABELLING REQUIREMENTS SHOULD NOT FORM A PART OF THE SPECIFICATION WITH WHICH ARTICLE 4.1 REQUIRES THE PRODUCT TO COMPLY. AS A MATTER OF PLAIN LANGUAGE, THE RULES IN SECTION H (WHICH INCORPORATE BY REFERENCE THE ITALIAN LAW AND REGULATIONS) ARE PART OF THE SPECIFICATION., LORDS, THE AUTHENTICITY OF PARMA HAM HAS TRADITIONALLY BEEN GUARANTEED BY THE BRAND ON THE HAM ITSELF. THE CONSUMER IN THE BUTCHER OR DELICATESSEN HAS BEEN ABLE TO SATISFY HIMSELF ON THIS POINT BY INSPECTING THE HAM FROM WHICH HIS ORDER WAS SLICED. BUT THE RETAIL REVOLUTION OF THE PAST 30 YEARS HAS MEANT THAT MUCH MORE HAM IS NOW SOLD PRE-PACKAGED IN SUPERMARKETS. IN THE ABSENCE OF CONTROL BY THE PRODUCERS OVER THE LABELLING OF SUCH PACKAGES, THE SUPERMARKET CONSUMER WOULD HAVE NO GUARANTEE OTHER THAN THE WORD OF THE RETAILER. HE WOULD HAVE TO TAKE ON TRUST THE CLAIM THAT THE PACKAGE CONTAINED GENUINE PARMA HAM. AND THE PRODUCERS IN PARMA WOULD HAVE NO CONVENIENT WAY TO PROTECT THEIR GOODWILL EXCEPT BY TESTING PACKAGES IN RETAIL OUTLETS ALL OVER THE COMMUNITY TO ESTABLISH, PERHAPS BY SOME FORM OF ANALYSIS, WHETHER THE PRODUCT SOLD AS PARMA HAM IS GENUINE OR NOT. IN THE PRESENT CASE, IT IS ACCEPTED THAT THE RESPONDENTS ARE HONEST TRADERS AND THAT THEIR PACKAGES CONTAIN THE AUTHENTIC PRODUCT. BUT THIS WILL NOT ALWAYS BE THE CASE. THE POINT OF THE LABELLING RULES, WHICH IN THE CASE OF PACKAGED PRODUCTS ARE INSEPARABLE FROM THE PACKAGING AND SLICING RULES, IS TO PROVIDE A RELIABLE AND EASY WAY TO DETECT INFRINGEMENT OF THE PDO. THEY COMPLEMENT THE INSPECTION PROCESS IN PARMA, WHICH OTHERWISE WOULD SERVE NO PURPOSE., LORDS, I DO NOT SEE HOW IT COULD BE MORE CLEARLY SPELLED OUT., LORDS, THE COURT OF APPEAL REGARDED THIS ARGUMENT AS SUPPORTING THEIR VIEW THAT THE REGULATION WAS NOT INTENDED TO BE DIRECTLY EFFECTIVE. BUT, IF YOUR LORDSHIPS AGREE THAT THE LANGUAGE AND PURPOSE OF THE REGULATION SHOWS BEYOND DOUBT THAT IT WAS INTENDED TO BE DIRECTLY EFFECTIVE, THEN THE ARGUMENT ON TRANSPARENCY BECOMES AN ATTACK ON THE VALIDITY OF THE DIRECTIVE, ON ITS COMPETENCE TO ACHIEVE ITS PURPOSE. MR GREEN IS SAYING THAT ALTHOUGH THE COUNCIL WHICH MADE THE REGULATION INTENDED IT TO BE DIRECTLY EFFECTIVE, IT WAS FOR THIS PURPOSE ULTRA VIRES BECAUSE THE METHOD OF LEGISLATION ADOPTED WAS NOT SUFFICIENTLY TRANSPARENT. FURTHERMORE, THE CRITICISMS WHICH ARE MADE OF THE LACK OF TRANSPARENCY OF THE PARMA HAM SPECIFICATION WOULD ALSO APPLY, ONE WOULD IMAGINE, TO EVERY OTHER SPECIFICATION BY REFERENCE TO WHICH A PDO OR PGI HAS BEEN REGISTERED. IT IS UNLIKELY THAT THE SPECIFICATION FOR BUXTON BLUE CHEESE IS MORE READILY AVAILABLE TO AN ITALIAN GROCER THAN THE SPECIFICATION FOR PARMA HAM TO AN ENGLISH ONE. THE REGULATION SPECIFICALLY CONTEMPLATES THAT REGISTRATION WILL BE BY REFERENCE TO A SPECIFICATION FOR WHICH NO PROVISION FOR PUBLICATION OR TRANSLATION IS MADE. SO THE ARGUMENT IS AN ATTACK ON THE VALIDITY OF THE ENTIRE SYSTEM OF PDO'S AND PGI'S CREATED BY THE REGULATION. IF YOUR LORDSHIPS REGARD SUCH A SUBMISSION AS ARGUABLE, IT WOULD HAVE TO BE REFERRED FOR DECISION TO THE EUROPEAN COURT. IN MY OPINION, HOWEVER, IT IS FOR A NUMBER OF REASONS NOT SO ARGUABLE., JUSTICE ARISING FROM THE DIFFICULTY OF OBTAINING A COPY OF THE SPECIFICATION. IF THE DEFENDANT NEEDED THE SPECIFICATION TO KNOW THAT THE GOODS INFRINGED AND COULD NOT REASONABLY HAVE BEEN EXPECTED TO OBTAIN A COPY, HE WOULD NOT BE LIABLE UNTIL THE RELEVANT PROVISIONS HAD BEEN COMMUNICATED TO HIM., JUSTICES WHICH MIGHT BE INFLICTED ON OTHER PEOPLE IF THE REGULATION WERE DIRECTLY ENFORCEABLE. I WOULD REJECT THIS ARGUMENT., LORDSHIPS THOUGHT THE POINT WAS ARGUABLE. BUT FOR MY PART, I DO NOT SEE HOW IT CAN BE., LORD SCOTT OF FOSCOTE. IN THE LIGHT OF HIS VIEWS, IT IS NOT POSSIBLE TO SAY THAT THE CONCLUSION WHICH I HAVE REACHED ON THE EFFECT OF THE REGULATION AND SPECIFICATION IS ACTE CLAIRE. SINCE THE CONCLUSION TURNS UPON THE CONSTRUCTION OF COMMUNITY INSTRUMENTS, IT IS THEREFORE NECESSARY FOR YOUR LORDSHIPS TO REFER THE QUESTION TO THE EUROPEAN COURT OF JUSTICE. I WOULD ADVISE YOUR LORDSHIPS TO REFER THE GENERAL QUESTION OF WHETHER, AS A MATTER OF COMMUNITY LAW, COUNCIL REGULATION (EEC) NO. 2081/92 READ WITH COMMISSION REGULATION (EC) NO 1107/96 AND THE SPECIFICATION FOR THE PDO "PROSCIUTTO DI PARMA" CREATE A VALID COMMUNITY RIGHT, DIRECTLY ENFORCEABLE IN THE COURT OF A MEMBER STATE, TO RESTRAIN THE RETAIL SALE AS "PARMA HAM" OF SLICED AND PACKAGED HAM DERIVED FROM HAMS DULY EXPORTED FROM PARMA IN COMPLIANCE WITH THE CONDITIONS OF THE PDO BUT WHICH HAVE NOT BEEN THEREAFTER SLICED, PACKAGED AND LABELLED IN ACCORDANCE WITH THE SPECIFICATION. A QUESTION FORMULATED IN SUCH TERMS SHOULD ENABLE THE RESPONDENTS TO PUT BEFORE THE COURT OF JUSTICE ALL THE GROUNDS UPON WHICH THEY SAY THAT NO SUCH COMMUNITY RIGHT EXISTS., LORD HOPE OF CRAIGHEAD, LORDS,, LORD HOFFMANN. I AGREE WITH IT, BUT I ALSO AGREE THAT IT IS NOT POSSIBLE TO SAY THAT THE CONCLUSION WHICH HE HAS REACHED IS ACTE CLAIRE . I TOO WOULD REFER THE QUESTION WHICH HE HAS PROPOSED FOR A PRELIMINARY RULING BY THE EUROPEAN COURT OF JUSTICE., LORD CLYDE, LORDS,, LORD HOFFMANN AND LORD SCOTT OF FOSCOTE I AGREE THAT IT IS NECESSARY FOR THIS HOUSE TO REFER A QUESTION ALONG THE LINES MENTIONED BY LORD HOFFMANN TO THE EUROPEAN COURT OF JUSTICE., LORD SCOTT OF FOSCOTE, LORDS,, LORD HOFFMANN, HAS, IN HIS OPINION WHICH I HAVE HAD THE ADVANTAGE OF SEEING IN DRAFT, SET OUT MORE FULLY THE BACKGROUND TO THE CASE AND HAS DESCRIBED THE PURPOSE AND EFFECT OF COUNCIL REGULATION 2081/92. I NEED NOT REPEAT WHAT HE HAS SAID AND WILL CONFINE MYSELF TO REFERRING BRIEFLY TO THOSE MATTERS THAT SEEM TO ME OF PARTICULAR IMPORTANCE FOR THE PURPOSES OF THIS APPEAL., LORDSHIPS., LORD HOFFMANN WOULD GIVE, IS THAT THE PROHIBITION APPLIES UNTIL THE PRODUCT REACHES THE ULTIMATE CONSUMER. MY DIFFICULTY WITH THAT ANSWER IS THAT IT WOULD APPEAR TO PLACE RESTAURATEURS OR DELICATESSEN OWNERS IN BREACH OF THE PROHIBITION IN CIRCUMSTANCES TO WHICH, IN MY VIEW AT LEAST, THE PROHIBITION COULD NOT SENSIBLY HAVE BEEN INTENDED TO APPLY. ANOTHER POSSIBLE ANSWER IS THAT ONCE A PDO PRODUCT COMPLYING WITH ITS PRODUCT SPECIFICATION HAS BEEN MARKETED, ITS ELIGIBILITY TO HAVE THE PDO APPLIED TO IT IS ESTABLISHED ONCE AND FOR ALL AND IS NOT LOST BY A SUBSEQUENT RE-PACKAGING AND RE-MARKETING OF THE PRODUCT. OR THERE MAY BE SOME INTERMEDIATE LINE TO BE DRAWN., LORD HOFFMANN HAS ANALYSED THE ARGUMENT PRESENTED BY MR GREEN IN SUPPORT OF HIS CONTENTION THAT THE LAW BROUGHT INTO EFFECT BY A COMBINATION OF COUNCIL REGULATION 2081/92, COMMISSION REGULATION 1107/96 AND THE PARMA HAM PRODUCT SPECIFICATION IS INSUFFICIENTLY ACCESSIBLE AND TRANSPARENT. I RESPECTFULLY AGREE WITH HIS ANALYSIS AND NEED NOT REPEAT IT. I AM UNABLE HOWEVER, TO AGREE WITH MY NOBLE AND LEARNED FRIEND'S CONCLUSION., LORD HOFFMANN AT PAGE 32 OF HIS OPINION.