Welcome to module eight dedicated to Geographical Indications. My name is Luisa Menapace and and I am a Professor for Governance in International Agribusiness at the Technical University of Munich. This module is divided into two lessons. In the first lesson we are going to talk about a concept of Geographical Indications (GI for short), their relevance in the EU market and the key facts related to the system of GI protection used in the EU for food and agricultural products. In the second lesson we will discuss a model that shows how GI certification can improve market efficiency. After completing this lesson you will be able to: explain the notion of Geographic Indication; explain the key facts regarding the importance of GIs in the EU market; and explain key facts regarding the EU system of protection for GIs and their economic implications. GI are a form of intellectual property rights just like trademarks or patents. They were recognized internationally as a form of property rights in the TRIPS Agreement of the World Trade Organization in 94. The TRIPS agreement, the agreement on trade-related aspects of intellectual property rights, sets down minimum standards for intellectual property protection in international markets. This is the definition of GI provided by the TRIPS Agreement. In their very essence, GI are indications (primarily geographical names) that identify a good as originating from a given area where the quality or reputation of the good is essentially attributable to it's geographical origin. A key feature of GIs is, therefore the link between the geographical origin and the quality of a good. A standard example of the quality-geography link, is the link between the features of the soil and the quality of a wine. Known GIs are Champagne, the sparkling wine from the Champagne region of France and Prosciutto di Parma or Parma ham, the dry-cured ham from the Italian region of Parma. While formalized only in 1994 at the WTO level, the concept of GIs is much older. In France, for example appellation of origin (an equivalent concept to GIs) were in use already during Napoleon's time. At the EU level there exists a body of regulations, listed on this slide, that protect GI names from misuse and imitation. These regulations cover different product categories agricultural products and foodstuffs, wines, spirits and aromatised wines. In spite of the existence of different regulations, the system used for the protection of GIs in the EU is quite similar across products. In what follows, I will focus on the system used for agricultural products and foodstuffs. This system was introduced in 1992 and successively updated, most recently we regulation 1151 in 2012. The GI system for agricultural products and foodstuffs distinguishes two types of GIs. Protected Designations of Origin (or PDOs) and Protected Geographical indications (or PGIs). On the left of the screen, you see the EU PDO and PGI seals. The seals must accompany the GI name on all GI-certified products. These seals are meant for consumers to be able to distinguish GI products from generic products and are an indication of the good quality of the product. The main distinction between the two types of GIs is the nature of the quality-geography link, which is stronger for PDOs than for PGIs. In particular, in the case of PGIs, the good reputation of a given area for the production of certain product may be sufficient to obtain GI protection. Here is an example. An example of a PGI is Nürnberger Lebkuchen. These are Christmas treats, similar to gingerbread, from the city of Nürnberg, Germany. Lebkuchen are made with honey, nuts and many spices such as aniseed, coriander cloves, ginger, cardamom and allspice. These spices are key ingredients but clearly are not typical products from Germany. What is critical for Nürnberger Lebkuchen to qualify as a PGI is the long tradition of the production of Lebkuchen in the area of Nürnberg, a tradition that has resulted in a refining of the product to a very high quality. Testimony of the long tradition can be found in illustrations of the art of Lebkuchen-making as early as in the sixteenth century. Here is an example of such an illustration.